The amount of monthly PPI refund payments paid to customers continues to stay ahead of 2014 levels according to the latest data released by the FCA.
Each month, the Financial Conduct Authority (FCA) releases data relating to the value of PPI refund payments paid to bank and credit card customer who were mis-sold payment protection insurance. The city watchdog has just published its data for July 2015 which although showing a slight decrease on July 2014, keeps the total value of PPI refund payments in 2015 ahead of the comparative period in 2014.
In July 2015, £327.9 million was paid out by banks and credit card companies to customers who were mis-sold payment protection insurance, bringing the total value of PPI refund payments for the year to date to £2.719 billion. By comparison, the total for 2014 up until the end of July was £2.659 billion. However, little of the increase can be attributed to banks and credit cards adopting fairer banking practices.
Last month the Financial Ombudsman Service published its complaints data for the first quarter of 2015/16 (April 2015 – June 2015) and the first half of the calendar year (January 2015 – June 2015). Both revealed quite disturbing figures about the level of banking practices being adopted by banks and credits card companies, with overall uphold rates for PPI complaints running at 74% and 76% respectively.
The worst offender among the major financial institutions was again the Lloyds Banking Group. More than 40,000 new PPI-related complaints were accepted by the Ombudsman from customers of the Lloyds Banking Group (which includes Lloyds PLC, Bank of Scotland, Halifax, and the Cheltenham & Gloucester Building Society), with 93% of PPI-related complaints against Lloyds Bank PLC upheld in the customer´s favour.
The Lloyds Banking Group recently increased its provision to pay PPI refund payments by £1.4 billion, and the group´s CEO – Antonio Horta-Osorio – warned that another £1 billion could be added to the provision during 2015, with another £2 billion allocated in 2016. Mr Horta-Osorio is possibly considering a soon-to-be-delivered statement from the FCA regarding the implications of the recent Plevin –v- Paragon Personal Finance court case, in which the claimant was successful in claiming that PPI was mis-sold to her because the value of the sale commission was not made clear.
If the FCA confirms all customers are entitled to PPI refund payments for the sales person´s lack of transparency, the value of monthly PPI refund payments could outstrip the record levels seen in 2012.Read More