Vocal customers will get more visibility now

Since July 2011, the Consumer Finance Protection Bureau (CFPB) is collecting a database of bank customers’ complaints to make a better competitive landscape in personal finance. Currently the bureau has the largest dataset of more than 500,000 complaints on major personal finance topics – mortgage, student loans, personal loans, debt collection, credit and prepaid cards, and other services.

The top 3 complaint topics are the following:

• Mortgage: 38.4%
• Debt collection: 15.49
• Credit reporting: 13.84%

Until recently, not all details of the complaint were published on the Consumer Complains Database; only some statistical attributes of the complaint - issue type, area, organization name, etc. were publicly visible.

On July 2014, CFPB proposed a policy change that allowed customers to have their bank complaints narratives published online. After a long discussion with the banking community and customers advocates, the bureau recently finalized the policy and adopted it. On March 19 2015, CFPB announced in a blog post that ever since every customer that will post a complaint on a http://www.consumerfinance.gov/ will have a option to share the story online in the Customer Complaints Database. That will give customers the option to show the context of the issue, share their frustration and provide details that might be helpful to others looking for financial services.

To protect users’ privacy, the bureau will take necessary precautions – no personal information will be published online. Even the ZIP code of the user will not be shown for locations with less than 20k population (3 digit ZIP codes will be shown in that case unless there is less than 20k inhabitants in a 3 code area).

Before publishing the complaint to the database, CFPB is making a number of cross checks – for example ensuring the relationships between the customer and the financial organization. Financial organizations will have an option to post a public facing response to the user complaint – CFPB will provide the resource for that.

Banking community is not too excited about the new policy – main concerns raised about data verification process - industry experts are cautious about fake reviews from anonymous that can damage the business public image. There is also another issue with giving the detailed public-facing response without disclosing any personal data or financial data – financial organizations will be limited in protecting their business.

We at CardsMax are using CFPB data heavily in our studies; just recently, we published a geography of bank customer complaints. We are looking forward to see the real stories of bank customers in a CFPB database soon. The bureau already started collecting complains narratives on its website; however, it will start publishing the data online after 90 day of preparatory period.