The Financial Conduct Authority (FCA) has launched a consultation seeking views on proposals to improve the way regulated firms report customer complaints to the regulator, and the changes to the associated complaints reporting rules.

This consultation is aligned with its five-year strategy to become a smarter regulator, which the FCA said includes “simpler, more efficient and effective” data collection from those it regulates.

Currently, the firms it regulates must report the number of customer complaints they receive to the FCA, and this data collection has not been reviewed since 2015.

Therefore, the consultation will examine how the FCA can simplify how firms report complaints to the authority, make the process more consistent and improve the quality of the data it collects.

In particular, the consultation will seek to consolidate five existing returns into a single return.

It acknowledged that many firms have to complete multiple (and sometimes overlapping) returns, which creates “inefficiency and unnecessary burden”.

The FCA suggested that these returns increase the risk of misreporting and make it difficult for the authority to interpret trends through repeat or overlapping complaints data.

Its research suggested that currently 41.3 per cent (or 9,802) of relevant firms have to submit multiple returns.

The report highlighted several problems with the current complaints reporting process, including: Multiple complaints returns, complaints reporting scheduled by firm accounting reference dates, different levels of detail in complaints data based on reported complaint numbers and the categorisation of complaints, which is unclear or outdated.

In moving to a single return, the FCA aims to improve the consistency of reporting by standardising the reporting frequency for all regulated firms, meaning that data is received from firms at the same time.

This, the FCA said, will give the authority the ability to compare the reporting and identify any causes of consumer harm more effectively and quickly.

To measure success, the FCA will monitor the feedback (numbers of comments and queries) it receives via RegData from firms about their experiences completing the new data return.

Additionally, it will monitor the number of queries that firms make to its Supervision Hub about the new return.

However, the FCA explained that as the return will be new for all reporting firms, it would expect, beyond initial bedding in, any potential initial increase in the number of queries to level out and fall over time.

It will also monitor the outcome of cases it raises as a result of the data it collects on firms' complaints data.

The FCA welcome responses to this by 24 July 2025 and aims to publish a Policy Statement “later” in 2025 and to provide firms with a year’s implementation period.

It said it would “particularly welcome” views from the firms that respond about the length of the implementation period it has proposed.

Commenting on the launch of the consultation, Broadstone head of redress, Brian Nimmo, said: “The changes announced today by the FCA should eliminate unnecessary burden on firms while improving the ability of the regulator to monitor and tackle consumer harm.

“Accurate and timely data is critical to helping the regulator analyse where sectors or individual firms are falling short and require closer scrutiny."

Nimmo emphasised that these changes are “integral” to achieving the FCA’s objectives of improving outcomes, reducing the regulatory burden and the fair treatment of consumers.

“Any measures that help meet these criteria are to be welcomed,” he added.

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