29th August 2014
Those who have already received compensation for payment protection insurance (PPI) mis-selling may be due more money as 2.5 million cases are reviewed.
The City watchdog, the Financial Conduct Authority (FCA), has announced banks, credit card providers and personal loan companies have agreed to reassess more than 2.5 million PPI complaints from 2012 and 2013 which may have been unfairly rejected or paid too little compensation to.
The PPI scandal has been ongoing for a number of years and over the past three years £16 billion has been paid out in compensation.
Despite being forced to review complaints, the FCA said firms have improved the way PPI grievances are handled.
‘Making sure anybody previously mis-sold PPI is treated fairly now, and paid redress where its due, is an important step in rebuilding trust in financial institutions,’ said Martin Wheatley, FCA chief executive.
‘The process is now working well; in just over three years £16 billion has been put back into the pocket of the consumer – that is unprecedented. Given the enormity of this exercise it is no surprise that there have been some issues along the way but our approach is delivering a good result for consumers.’
A total of 13 million PPI complaints have been handed since 2007 and seven out of 10 claims have been upheld in the consumer’s favour. The Financial Ombudsman Service has received over one million complaints from people unhappy with the response from their provider – equal to a quarter of all rejected complaints.
There are still a number of people yet to claim for PPI mis-selling; 3.2 million letters were sent to people who are likely to have been mis-sold the insurance but have yet to complain and a further two million letters will be sent in coming months.
The FCA hopes to be able to scale down its intensive PPI work during 2015.