How to resolve a dispute with your bank

What are we disputing?

More and more, it's our credit products, our insurance policies, our investments and our payment systems. We're complaining about banking errors (both by computers and humans), contract and calculation errors, insufficient or misleading disclosure statements, and conduct that contravene legal codes.

In one of my columns, Going direct to a home lender, I examined how service levels at the big banks can vary considerably, and - with the popularity of complaints forums such as Not Good Enough - some of us might say it's no surprise that disputes are common. So, if you find yourself in a dispute with your bank or financial provider, what can you do to have it resolved in your favour?

How to fight the bank

Here are some tips to follow:

1. Be clear about what you're disputing

When you're in a dispute with your bank, it's important to be clear and concise. Be specific by listing the questions you want answered and what actions you'd like to the bank to take.

Be sure to keep records of any conversations you have, as well as copies of all documentation. Keep the details of the people you speak to and, if you can, carry out your discussions in writing - that way you'll avoid misunderstandings about what has been said or requested.

Most importantly, stay calm no matter how angry or upset you might become. High emotions don't do anybody any good. Focus on the facts while looking for a mutually acceptable solution to the problem.

2. Follow the bank's dispute procedures

Each of Australia's major banks and most of our financial institutions are members of the Financial Ombudsman Service. This membership requires them to have internal dispute resolution procedures and you should familiarise yourself with these before you start (information is usually to be found online or in your local branch).

While the big banks have large departments which deal exclusively with complaints, the best initial point of contact for your dispute is usually your branch. Start there, and try to ensure that the branch undertakes any proposed actions within the agreed upon time frame. Be sure to keep a record either way.

3. If you're still unhappy, escalate

If you're dissatisfied with the response you receive at branch level, ask how you can escalate the matter. Usually, this will result in the dispute being sent to head office or the internal dispute department.

Rather than dealing with a call centre, ask for a specific case worker to be assigned - a consistent point of contact that understands you and your problem and can take ownership of the issue.

At the same time, be prepared to compromise. You might not always be able to get exactly what you want, but if you can get most of it, that's often the best outcome.

4. Stick to your obligations

When you're in a dispute, it can be tempting to send a message by stopping payments or failing to meet your obligations while your dispute is unresolved. This is always a bad idea.

Failing to fulfill your obligations won't help your cause, and might result in further financial penalties. Always stick to your obligations unless you have an agreement, in writing, that they will be suspended while the dispute is ongoing.

5. Seek outside help

If all else fails, ask your bank how you can take things further and refer the matter to the Financial Ombudsman Service

The Ombudsman will investigate banking, insurance and investment disputes and is a free service. If the Ombudsman can't help, they will likely give you a further pointer to someone who can.

Staying calm:

Remember, your aim should always be to get your dispute resolved as quickly and as amicably as possible. At all times, state clearly what you want, keep your cool, retain good records, and follow the bank's resolution procedures.

If that fails, escalate your problem and go to the Ombudsman, but always be prepared to compromise if it means receiving most of what you want.