Cost of PPI mis-selling hits £215m as the FSA upholds 3 in 4 complaints
In the first half of 2011, consumers who have been mis-sold payment protection insurance
(PPI) and thereafter successfully claimed back
the cost of Payment Protection Insurance cost lenders a staggering £215m.
Figures released by the Financial Services Authority
also show that 3 in 4 PPI complaints
have been upheld which is good news for consumers. They also reveal that of all the complaints made between January and June this year, 92% were made against just 16 businesses.
"The High Court ruled in April that banks and other businesses which have mis-sold PPI policies to consumers must pay it back in full," said Bryan Nott of Simpson Millar LLP. "The most important thing is that the process for responding to complaints and paying out compensation is efficient and fair."
The majority of high street banks have now set aside significant sums of money to settle PPI claims
. To date Lloyds boasts the largest settlement bill at a staggering £3.2bn.
"The PPI saga has no doubt tainted the reputation of many lenders in the eyes of consumers. Where few have acted and responded swiftly, many have rather dragged their feet and made it worse," said Bryan.
According to the FSA, the average payout
for a mis-sold PPI policy was £2,750
Margaret Cole, interim managing director of the FSA's conduct business unit said: "We remain 100% committed to ensuring that where consumers were mis-sold PPI they will receive the appropriate redress from firms, and we are monitoring firms' progress to ensure this is done properly."