Banks continuing to mislead customers over PPI
Banks accused of wrongly informing customer they are not entitled to compensation as deadline nears
Banks have been accused of wrongly informing customer they are not entitled to PPI compensation.
The mis-selling of Payment Protection Insurance (PPI), which was meant to help people keep up loan repayments if they became ill or unemployed but was often added on to credit cards, mortgages or other loans without people wanting or needing it, has already cost Britain’s banking and insurance sector £32.9bn.
Customers are being encouraged to check with their lenders to see if they were mis-sold PPI before the deadline for claims expires on 29 August 2019.
The Alliance of Claims Companies, which represents claims management firms, has alleged banks “across the board” were incorrectly telling some customers they had never had a PPI policy.
Barclays recently admitted an error in its system that handles requests from claims management companies (MCs) had resulted in the bank giving wrong information to tens of thousands of its customers.
The BBC also reports individual cases concerning NatWest and Halifax where the bank had informed customers they never had PPI, when in fact they did.
Simon Evans, the chief executive of the Alliance of Claims Companies, has described the issue as “a massive problem”, adding errors happen “too often to be a coincidence” and that if banks “can put consumers off from claiming by telling them in the first instance an answer is ‘no’, they will try and do so”.
In a progress update published last month, the Financial Conduct Authority (FCA), said its public awareness campaign featuring an Arnold Schwarzenegger animatonic head had led to a 40% increase in PPI checks, with 55% of complaints having been made directly, compared to 45% before the campaign began last autumn.
At least £3.7bn of redress has been paid since the start of the campaign, a 64% increase on the previous 10 months.
This month, the FCA announced it had enlisted the help of fashion guru Gok Wan and restaurateur Fred Sirieux, best known for his role on reality TV dating programme First Dates, to help “empower the UK public to complain with confidence”.
It follows findings which show 15 million people across the UK regularly miss out on refunds and compensation because they lack the confidence to complain, with 72% of those surveyed saying they wished they were better at complaining.
Jonathan Davidson, FCA executive director of supervision, retail and authorisations, said: “We are encouraged by the results of the first 10 months of the campaign. However, with less than a year until the deadline, we will carry on working hard to ensure every consumer has had the chance to make a decision on whether to complain about PPI.”