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PPI: UK regulator says need for continued vigilance as it gathers evidence on PPI complaints process and warns of possible further PPI intervention

The Financial Conduct Authority is set to gather evidence on current trends in payment protection insurance complaints, warning that further interventions may be appropriate. The FCA will use this evidence to assess whether the current approach is meeting the objectives of securing appropriate protection for consumers and enhancing the integrity of the UK’s financial system. If appropriate, further interventions could include a consumer communication campaign, a possible time limit on complaints or other rule changes or guidance. In August 2014, the FCA’s thematic review on PPI redress revealed that banks, credit card providers and personal loan companies had agreed to reassess more than 2.5m complaints during 2012 and 2013, which they may have either “unfairly rejected or paid too little redress to”. The FCA’s work is due to commence shortly and views on the evidence collected will be delivered in the summer. 

Note: The Financial Ombudsman Service was forced two years ago to expand its staff by 500 to deal with the deluge of complaints. Even now, PPI remains the most complained about product, with recent Fos data revealing that last year there were 48,516 PPI complaints out of a total of 74,357 new complaints received by Fos. Since January 2011, firms have handled over 14m consumer complaints about the sale of PPI, upholding over 70% and paying £17.3bn in compensation, according to FCA figures. Crucially, making such complaints is free to consumers and there is no need to use a claims management company - a sector which itself is now under stricter regulation via the newly-empowered Ministry of Justice’s Claims Management Regulator

ID: 48697
Publication date: 30/01/15

Created: 02/02/15. Last changed: 02/02/15.
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