Last month the Financial Services Authority published a review that found widespread failings in how products are sold across the sector due to inappropriate incentives being offered, most notably in banks but also across investment firms.
Martin Wheatley, FSA managing director and chief executive designate of the incoming Financial Conduct Authority, said banks must reform their incentive programmes and that the FCA would be conducting a further review next year to assess progress. He warned that enforcement action could follow if warnings are not heeded.
Under the new ‘service incentive programme’ announced yesterday (10 October) by Barclays, employees will receive no commission or incentive from selling products.
Incentives will focus instead on customer advocacy and satisfaction, with employees receiving a ‘service incentive’ based on how satisfied customers are with the service provided, as well as the extent to which they would recommend Barclays.
Antony Jenkins, group chief executive, said: “We believe that becoming the ‘Go-To’ bank is about helping people and businesses get on.
“Therefore the key to Barclays long-term success is the level of service we provide, not how many products we sell. We want customers to choose Barclays because of the great service they receive from us.”
This follows from the Co-Operative Bank’s move earlier this month to launch a bonus scheme which rewards branch staff solely on their customer service performance.
The Co-Op has removed sales targets for customer-facing staff and, instead, staff will have to demonstrate “excellent customer service” to receive a quarterly reward.