Fresh complaints about the mis-selling of payment protection insurance (PPI) continue to dominate the workload of the Financial Ombudsman Service.
In July, August and September this year, the Financial Ombudsman Service handled nearly 140,000 enquiries from consumers and took on nearly 80,000 new cases. More than half concerned PPI.
The ombudsman received an extra 42,907 PPI complaints between July and September after banks rejected their customers’ claims for compensation.
Packaged bank accounts were the second most complained-about financial policy.
But the number of those trail far behind PPI, at just 5,317 during the quarter.
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PPI: a costly scandal
The figures highlight yet again the scale of the PPI mis-selling scandal and the cost of the scandal to UK banks. And complaints are still flooding in.
The main City regulator, the Financial Conduct Authority (FCA), has proposed June 2019 as a cut-off point for any new complaints to be lodged with banks, but the claims continue to pour in.
Recently Barclays set aside an extra £600m for compensation costs and Lloyds Banking Group put aside a whopping £1bn extra.
Lloyds has now set aside more than any other bank, at £17.1bn, followed by Barclays at £8.5bn, RBS at £4.7bn and HSBC at £2.9bn.
Since the start of 2003 the Ombudsman has received 1,445,000 complaints about PPI mis-selling.
10 most complained about financial products
The financial products that consumers complained about most to the ombudsman service in July, August and September 2016 were:
- payment protection insurance (PPI)
- packaged bank accounts
- current accounts
- car and motorcycle insurance
- payday loans
- house mortgages
- credit card accounts
- overdrafts and loans
- hire purchase
- buildings insurance.
Mis-selling to millions
PPI policies were supposed to provide cover if someone could not repay their loans or credit card bills, because of illness, accidents or unemployment.
But tens of millions of polices were mis-sold to people who did not want or need them.
The sale of PPI has now largely been banned.
Last month, the FCA also published findings from its thematic review and concluded that more can be done to prevent packaged bank accounts being mis-sold.
The regulator says firms have more to do to ensure customers are treated fairly, both when they take out a packaged bank account and when they complain.