>Mark Casci: How Yorkshire can play a leading role in tackling climate change >Mark Casci: How the auditing profession can regain its reputationAnd this week it will all come to an end.
At 11.59pm on Thursday of this week consumers will no longer be able to make a complaint or claim over the mis-selling of Payment Protection Insurance (PPI).
An estimated 64 million PPI policies were sold in the UK during the 1990s and early 2000s.
On the face of it, PPI was a good thing for consumers, allowing for the repayment of credit if the borrower died, became ill or disabled or lost their primary means of income,
The problem was the product was widely miss-sold by a variety of financial institutions.
People were pressed into taking out PPI policies when they did not want them. In many cases they did not even know they had the policy in the first place and were unaware they were paying for it. In an awful lot of cases it was totally unsuitable for them.
It is the most complained-about financial product that the Financial Ombudsman Service (FOS) has ever seen, having handled in excess of two million complaints regarding it.
And with the complaints came the claims.
Financial Conduct Authority (FCA) figures show firms have paid back £36bn since January 2011 to customers who complained – including £340.4m alone in June of this year.
This week it is estimated that a flood of last minute claims will be submitted.
The FCA suggest there has already been a recent surge in activity by consumers – and it is now gearing up for a flurry of inquiries ahead of Thursday’s deadline.
It was not just the mis-selling that has proved a sticking point.
Even if people do not think they were mis-sold, there is also now another reason to complain about PPI.
Following a court case known as ‘Plevin’, people can also complain on the basis that a high level of commission was earned from the sale of the policy – but they were not told about it.
People can complain about commission even if they have had a previous complaint about mis-selling of PPI rejected.
The FCA’s website includes a list of providers that have sold PPI that includes high street stores, catalogue firms, building societies and supermarkets.
Nearly a fifth (18 per cent) of 2,000 consumers surveyed for the FCA say they will make a last-minute decision on whether to complain about PPI.
However, the regulator is urging them to act now, and for good reason.
In the past eight weeks since the FCA’s final PPI push went live, it has seen a 420 per cent surge in web users, and a 269 per cent increase in calls, compared with the previous eight weeks.
More than 5.1 million users have now accessed the FCA’s PPI website which offers help with claiming and 84,733 calls have been made to its dedicated contact centre.
Just over half (53 percent) of these ‘last minuters’ are confident they will complain ahead of the deadline while there are fears others will miss out.
Emma Stranack, the FCA’s PPI deadline campaign lead, said: “Leaving things to the last minute is natural behaviour for many of us and we’re sharing these findings to show that anyone who hasn’t yet decided on PPI is not alone in leaving things close to a deadline. That said, now is the time to act.”
The FCA has extended its PPI helpline hours to 8pm on week nights and 5pm on Saturdays to provide further support to consumers.
While it is imperative that consumers ensure they are properly compensated for their loss it is equally important that the financial industry is able to move on from this debacle.
For too long banks and other institutions have continually had to put millions aside every year to deal with this. It has been a veritable albatross around the sector’s neck.
With this encumbrance set to evaporate we need our banks to be able to move on and ensure such malpractice does not occur ever again.