While the financial sector is shelling out billions in PPI claims, the big banks are coming under fire for allegedly sabotaging payments by stalling cases, or “losing” vital data relating to individual cases.
Since compensation started in January 2011, UK consumers have enjoyed a £27.1 billion payday. And it sets to continue with banks putting aside more and more money to cover future claims.
The role of PPI was to insure both the banks and consumers when repayments on loans, mortgages and credit cards were made impossible through redundancy or ill health. The courts decides in 2010 that there had been a huge and widespread scandal involving the misspelling of this insurance product, and that countless number of consumers were entitled to a full rebate, plus interest.
However, it now appears that there has been an increase in the number of consumers reporting that their data and files to their cases have been lost. The Alliance of Claims Companies (ACC) recently reported that Black Horse, the motor finance firm has reported that it could not find up to 80 per cent of claimants’ details.
Other banks have reported losses, although not as steep. In terms of rejected claims relating to loss of data the following banks have reported the following:
HSBC: 6 per cent in January, 42 per cent in April
Barclays: 8 per cent in January, 30 per cent in April
MBNA: 7 per cent in January, 28 per cent in April
Lloyds: 5 per cent in January, 35 per cent in April
RBS: 29 per cent in January, 47 per cent in April
(data courtesy of LondonLovesBusiness)
Banks are contacting their consumers to produce more evidence for their case, with critics arguing that this is a delaying tactic, and could also deter the consumer from chasing their PPI claims.
This latest criticism comes after the Financial Conduct Authority (FCA) has announced plans to urge the public to chase up any PPI refunds they feel they may be entitled to. The deadline for PPI claims to be made is August 2019, which should trigger even more claims. However, with the latest setback delaying current claims, it might lead to further problems for finance departments in charge of resolving outstanding and future claims.