The Financial Conduct Authority will soon publish a report into the payment protection insurance mis-selling scandal. However, we fear that a cut-off date for complaints is being considered.
A ‘time bar’ on payment protection insurance (PPI) complaints would be to the detriment of consumers. That’s why myself and Martin Lewis have written to the FCA’s acting chief executive Tracey McDermott, calling on her to scrap any plans for a cut-off date for consumers to reclaim mis-sold PPI.
You can read our open letter below:
We write to express our serious concern at reports that the FCA is considering the introduction of a time bar on PPI complaints. We believe such a move would be to the detriment of consumers and provide the banks with an undeserved resolution to an issue that is entirely of their own making.
Both Money Saving Expert and Which? have spent a considerable amount of time working with banks to improve their customer communications and complaints handling procedures. However, not one of them has agreed to proactively contact all of their customers known to have been sold PPI. This would have triggered a limitation for complaints to the Financial Ombudsman Service and thus given the banks certainty about the timeframe for compensation.
While some banks have taken positive steps to deal with PPI claims and quickly resolve issues for their customers, there are two banks in particular that have high uphold rates for PPI complaints escalated to the Ombudsman, and have set aside substantial extra provisions for PPI mis-selling. This suggests that they are far from finished dealing with the issue. A time bar would therefore disproportionately benefit those banks that have been worst at resolving this problem.
Such an unprecedented move would also create a field day for claims management companies that would inevitably switch their attention to bringing claims in the courts.
Instead of consulting on a time bar, we urge you to redouble your efforts to ensure that all banks are handling complaints quickly and properly, and to make sure that consumers are given the compensation they are rightly due.
Richard Lloyd, Executive Director, Which?
Martin Lewis, Money Saving Expert