Financial Ombudsman Service chooses TCS as digital transformation partner

The Financial Ombudsman Service (FOS) has hired Tata Consultancy Services (TCS) to build key systems in its digital transformation.

The 20-year-old dispute resolution service is on a digital transformation journey in the light of increasing workloads faced by its 4,000 staff.

TCS will design and implement a new digital customer portal and complaint management and reporting system.

About one million contacts are made with the service each year – when consumers have issues with a finance product or financial service provider, it is the FOS that settles the dispute between the parties involved.

All cases have to be carefully documented and investigated, which makes the FOS a people- and document-heavy organisation. But while only experienced employees can investigate cases, technology is playing an increasingly important role in improving access to the service, storing and retrieving information, and managing the workforce.

Nicola Wadham, CIO at the FOS, said: “We share a common desire to create digital channels that make a difference in serving all our customers, both businesses and consumers, by increasing accessibility to our service and improving our response times. Working with a world leader in technology services and digital delivery, whose values reflect our own, is a significant milestone in our digital journey and we are looking forward to delivering on our ambitious plans.”

The FOS recently moved human resources and financial management software into the cloud, through a deal with Workday.

The organisation has been central to resolving disputes around payment protection insurance (PPI) products and their mis-selling. It was the PPI scandal that led to the FOS growing rapidly, from about 300 staff when it was formed in 2001 to 4,000 today. It was this workload that led the organisation to switch from paper-based processes to its first in-house-developed case management software, built on an SQL server.

With PPI disputes now coming to an end, it might be understandable for the FOS to scale back, but the financial technology (fintech) revolution makes its services more important than ever. The huge volume of new finance products arriving on the market, from a plethora of new companies, risks the finance sector becoming a minefield for consumers and the businesses that sell financial products to them. Just as PPI forced the FOS to transform, the fintech boom is pushing it further.

Figures from consumer rights organisation Which? show that the FOS is receiving a growing number of complaints from consumers saying they are not being reimbursed. Between 2020 and 2021, the number of such complaints increased from 3,600 to 7,770.

Meanwhile, the FOS IT contract is another key public sector win for TCS.

Amit Kapur, UK head at TCS, said: “This partnership with the ombudsman strengthens our collaboration in the UK public sector financial services, and we are pleased to be their partner of choice for future-proofing their technologies and managing their digital transformation strategy. The ombudsman’s customer-centric focus aligns with our own goals, and we look forward to working together to enhance the digital experience for all users.”

According to Tussell, which analyses government spending data, in 2017, TCS made £30.9m sales to the UK public sector, and this figure increased to £52m by 2019, before the pandemic slowed things. There is huge potential for growth in the UK public sector for TCS and other Indian services firms, where their market share is a fraction of that in the private sector.