I recently had an interesting exchange with a FinTech founder about how to structure T&Cs in such as way that customers complain less and protect the entity from unreasonable or unfounded customer complaints.

My position is that the easier and simpler your T&Cs are, the less likely your customers are to complain, and the more obscure and fine-printed your T&Cs are, the more likely your users are to suspect unfairness, so they will be more likely they to complain.

There is obviously a difference between a customer inquiry and a formal complaint. You may get 100 questions and inquiries from customers about fees, exchange rates, handling times, funds availability, your pricing, blocking or unblocking transactions, refusal to open accounts, refunds and reversals, and similar issues, and in most cases, you should be able to amicably resolve those cases without such cases to become a formal complaint. 💁

What is a formal complaint? – This is a statement from a customer or their lawyer that their legal rights were somehow violated and they want your entity to resolve this issue by requesting a refund, compensation or some other specific action to be taken.

Why do I believe that simple and clear T&Cs will help you? – Because they will help you explain the situation to the customer by pointing out a specific section within the T&Cs, and hopefully the customer will be able to see what makes sense. When this happens, the inquiry does not escalate to a formal complaint. If your T&Cs are obscure and ambiguous, the customer may become even more annoyed and agitated and inclined to take further legal steps.

My mentor, James Wedmore, has a similar position about offering guarantees and refunds for digital training and information-based products. The longer the guarantee or refund period, the fewer refunds people will see. Why? Because when someone’s refund period is 1 week, customers may expect to see the results or outcomes or major benefits during this week, and if this does not happen, they request a refund. When the guarantee and refund period is longer, the customers are more patient (with themselves) and don’t have such high expectations. Obviously, this strategy won’t always work with books or other downloadable content, where there is a greater opportunity to download everything and claim a refund, but for any programs where teaching or some sort of ongoing content release is a big part of the program, it totally makes sense.

Have you seen something similar? What are your thoughts on this? 💭

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