2nd October 2015
All PPI claims may have to be settled by spring 2018 with a new deadline being proposed by the UK’s financial watchdog.
The new rules proposed by the Financial Conduct Authority are likely to come into force by spring next year with claims having to made within two years of this date. The move will come as a relief to members of the public who resent being approached by PPI claims chasing firms.
The FCA says customers would need to make their PPI complaint by this deadline or else lose their right to have their complaint assessed by their bank or by the Financial Ombudsman Service (the Ombudsman).
The FCA will also launch a new communications campaign designed to prompt consumers to complain in advance of that deadline.
In a statement, the FCA said: “We will set out the full detail of these proposed rules and guidance, the evidence we have considered, our reasons for proposing them, and our assessment of their costs and benefits, in the consultation paper we will publish before the end of the year.”
More than £20 billion redress has been paid to over 10 million consumers so far, though the regulator says it has noticed other trends. But the watchdog now believes that such an intervention may encourage more consumers to complain directly to the firms, rather than using and paying claims management companies.
It adds that its research shows – a high and growing proportion of complaints are made via claims management companies, with fee costs to the consumers who use them
– a high and growing proportion of complaints relate to older sales (pre-2005 and even pre-2000), where the documentary evidence held by firms and consumers is likely to have significant gaps and recollections and oral evidence are becoming increasingly stale
– a significant proportion of complaints made turn out not to have involved a PPI sale
– a number of those consumers who told us they intended to complain, also said that they had not yet got around to doing so. The open-ended nature of the complaints-led approach appears to contribute to this consumer inertia – i.e. it does not incentivise consumers to check whether they had or have PPI or progress complaints in a timely fashion.