Financial Ombudsman Service deals with record number of complaints as consumers fight back

In resolved cases, there was continuing wide variation between institutions in the uphold rates - the proportion of cases won by the customer, prompting chief ombudsman Tony Boorman to say: "In far too many cases, uphold rates remain stubbornly high, highlighting the need for financial businesses to do more to demonstrate their longer-term commitment to listen to customer's concerns as they seek to rebuild trust."

The FOS can award compensation of up to £150,000 if it finds in a consumer's favour, as well as telling the company to put the consumer back into the position they would have been in, if the original problem hadn't happened.

The most common complaint last year was about payment protection insurance (PPI), which made up 86% of the total in the first half of last year and 76% in the second half.

Mr Boorman admitted that the number of new PPI cases was still "depressingly high". He concedes: "We're still a long way from being able to say that PPI is sorted once and for all. Over 1000 people every day are still asking us to sort out PPI problems that they've not been able to resolve directly with their bank."

Many PPI complaints are still driven by cold calling claims management companies, who take a share of any compensation given to a consumer, despite the efforts of the FOS to make it known to consumers making the complaint themselves is easy and free of charge.

If you complain to the FOS yourself, there is a good chance your complaint will be upheld. In the first half of 2013, 65% of complaints were upheld and in the second half 51%. And Rory Stoves of FOS points out: "There is no difference in uphold rate, whether a consumer brings a complaint themselves, or if they bring it using a claims manager."

In the last six months of 2013, the most complained-about businesses were Lloyds Banking Group which includes Bank of Scotland, Barclays, RBS, HSBC and the credit card firm MBNA. Clydesdale Bank also makes it into the top 10.

For all of these groups, it is PPI complaints that account for the bulk of their grievances. At Clydesdale, 80% of complaints in the second half related to PPI.

By contrast, complaints about financial products other than PPI were down last year. However, this doesn't necessarily mean customers are more satisfied. Companies may just be dealing with complaints better.

There is a financial incentive for them to do so as it is they who have to pay around £500 per complaint to FOS to cover the cost. And you cannot approach the FOS for help until you have exhausted a company's own complaints procedure - subject to certain time limits - and are still dissatisfied with the outcome.

One of the sharpest drops was in complaints about banking generally. There was a 22% decrease in these complaints in the first half of 2013 and an 11% decrease in the second half.

However, the more illuminating figures are those which show what proportion of customer complaints is upheld by the FOS at each institution, and in each category. Among the banks, for instance, 81% of PPI complaints against Barclays were upheld, compared with an average 56% for all businesses, and 31% for RBS, 5% for Nationwide and 3% for Yorkshire building society.

Bank of America-owned MBNA had 80% of PPI complaints upheld and 96% of general insurance complaints.

The mutuals also showed up well overall, with only 10% of complaints upheld at Nationwide and 4% at Yorkshire. The Cooperative had 23% of its complaints upheld, Clydesdale 24%, RBS 31%, Bank of Scotland 43% and Lloyds 54%.

In the investment complaints category, the most complained-about non-banking group in the second half was the rapidly growing St James Wealth Management, which has gained business from independent financial advisers following the change to fee-based advice at the beginning of 2013. Half of its complaints were upheld (42% average) while online broker TD Direct had 66% upheld.

On the life insurance and pensions side, the largest number of new complaints in the second half of last year related to the Prudential, but the FOS received an almost identical number of complaints about Phoenix Life, which spans Scottish Mutual, Scottish Provident and Pearl. At Phoenix, the complaint uphold rate was 18% and Prudential 17%, compared with 15% at Standard Life, 26% at Royal London (Scottish Life) and 34% at Aegon-owned Scottish Equitable.

DirectLine, Axa and Aviva had the most general insurance complaints, where there may now be a surge this year following recent bad weather conditions across the UK.

Recently, the FOS published examples of consumers who had complained because their insurers had rejected claims for damage to their property caused by storms and freezing conditions. Disputes often revolve around whether the main cause of damage is the weather, or wear and tear or whether pipes bursting are due to a prolonged absence of the homeowner.

Another reason to believe the number of complaints to FOS may continue to rise is that it also covers payday lending and another new area being added to its remit soon is peer-to-peer lending. Both borrowers and lenders will be able to complain.