Canada rolled out new rules for banks and here's how it could impact you

Canada has updated its rules for banks and authorized foreign banks that affect customers submitting complaints.

The Financial Consumer Agency of Canada (FCAC), which is a watchdog for federally regulated financial entities, published an updated guideline on complaint-handling procedures for banks on Tuesday.

According to the FCAC, banks are required to comply with complaint-handling obligations laid out in the Bank Act and the Financial Consumer Protection Framework Regulations. This includes establishing complaint-handling procedures, adhering to prescribed timelines for resolving complaints, and communicating clearly with customers.

"FCAC revised the Guideline to reflect the supervisory observations the Agency has made since its introduction in 2022 and to clarify expectations for how banks meet their legislative obligations," reads a statement from the FCAC. "It reinforces FCAC's expectation that banks implement complaint handling processes that are effective, timely, and accessible, and that support clear, consistent, and transparent outcomes for consumers."

The key update that may affect you is that banks in Canada must now resolve or close a consumer's complaint within the legislated 56-day period, without pause.

In addition to that strict timeline, Canada also expects banks to provide consumers with a clear and timely acknowledgement confirming receipt of a complaint.

"The acknowledgement is to include key information about the complaint-handling process, including applicable timelines, the steps involved, and what the consumer can expect next," stated the FCAC.

Banks in Canada also need to clearly indicate when they have provided their final response to a consumer's complaint, according to the FCAC. Banks are expected to issue a Notice of Final Decision at the conclusion of any complaint that has not been resolved at the first stage of the bank's process, and to inform customers of their right to escalate their complaint to an external complaints body.

"The revised Guideline makes explicit banks' obligation to have a comprehensive policy to provide timely redress where required under the Bank Act," the FCAC added. "The Guideline also clarifies FCAC's expectation that banks provide consumers with timely remediation for harm based on the circumstances of the complaint."

For more details, read the FCAC's full announcement.