Which? calls for clear PPI refund guidanceBanks must be clear about how to lodge a PPI claim

06 March 2012

Letter coming through letterbox

PPI letters must be clear about your rights to submit a mis-selling claim and the timeframe for lodging a PPI complaint

As the Financial Services Authority (FSA) today publishes draft payment protection insurance (PPI) guidance for financial providers, Which? is calling for a set of strong guidelines covering how banks communicate with consumers about PPI redress.

Paying back mis-sold PPI must be a priority

Which? executive director, Richard Lloyd, says: 'We’ve seen some really poor examples of communication from banks to their customers. There is no excuse for banks making the PPI mess even worse through unclear and confusing contact with customers entitled to compensation.

'Paying back mis-sold PPI promptly must be a priority for lenders that made billions from this deeply flawed product. It's essential that the regulator's new guidelines require all financial providers to be clear with people about their rights to a claim, the process and the timeframes for lodging a complaint.'

Why banks need to take action on PPI communications

Which? has been concerned for some time about the way banks communicate with their customers, and has more recently received enquiries to our Money Helpline from people who have been sent letters about their PPI policy. People found the wording confusing and unclear.

We contacted the FSA, setting out our concerns and calling for action to be taken to ensure customer contact letters are made clearer and easier to understand.

The FSA has since been working with Which?, other consumer groups, banks, the BBA and other industry bodies to reach agreement about how to improve communications. The FSA is now consulting on guidance regarding PPI communications and Which? will be responding to ensure consumer needs are at the heart of the new guidance.

Banking industry pledges to improve PPI communications

The British Bankers’ Association (BBA) and the Association of Finance Brokers (AFB) welcomed the FSA's consultation.

They stated: 'We continue to work with Which? and other consumer bodies, discussing how to practically improve PPI communications in general. The agreed aim is to make letters more accessible and readily understandable for customers.'

The BBA and AFB pledged to make sure that communications:

  • set out a clear summary at the start of the communication
  • use straightforward language and an accessible tone
  • are written in concise sentences and paragraphs
  • set out clearly the terms to which they refer and explain any abbreviations
  • avoid the use of jargon and limit the use of overly complex technical or legal language

Which? PPI claim tool

Which? has long campaigned for redress on mis-sold PPI on credit products. If you think that you've been mis-sold PPI, you can use the free Which? online PPI claim tool to help you submit your claim. More than 14,000 of you have sent complaints via the tool since it was launched.

More on this...

  • Use our free online PPI claim tool - Which? helps you submit a PPI claim
  • The Which? PPI campaign - read about our longstanding PPI campaign
  • Phone the Which? Money Helpline - give us a call with your PPI complaint queries