The Financial Conduct Authority (FCA) has revealed that it will not be making an announcement regarding a payment protection insurance (PPI) complaints deadline before the end of 2016.

When the regulator issued its consultation paper proposing a deadline of June 30 2019 for making a PPI complaint, it said it expected to be in a position to proceed with new rules and guidance prior to the end of the year. This latest announcement reveals that the FCA has in fact not yet reached a final decision on the matter, apparently because of the large number of responses to the consultation paper, and that it now expects to make another announcement regarding PPI before the end of the first quarter of 2017.

In addition to a claims deadline, the consultation was also concerned with new rules allowing consumers to table PPI complaints on the grounds that a large commission was not disclosed by the seller. This follows the landmark court ruling in the case of Plevin v Paragon Personal Finance.

There is no indication in the FCA’s statement that the deadline will be extended from the original proposed date of June 30 2019, or that the deadline will be scrapped entirely. However, The Guardian is amongst the media outlets suggesting that it is likely that the deadline will now be set for later in 2019.

The consultation proposed allowing firms to reject PPI complaints submitted to them after mid-2019, unless the complaint concerned a policy sold in recent years, or was concerned with claims and/or administration rather than a possible mis-sale of the insurance. The firms that sold the most PPI would be required to fund a publicity campaign informing consumers of the impending deadline. Also contained in the paper was a proposal to allow customers to submit a complaint where they were sold single premium PPI and were not informed of a commission payment that exceeded 50% of the premium.

PPI complaint volumes have reduced slightly in the last few years, but it still accounts for almost seven times as many complaints as any other financial product, according to data for the third quarter of 2016 published by the Financial Ombudsman Service (FOS). The likelihood of a deadline being imposed has however led to predictions of a spike in PPI complaint numbers, prompting Lloyds Banking Group and Barclays Bank, amongst others, to increase their PPI compensation reserve once again. Lloyds has now set aside £17 billion to settle mis-selling claims and the industry’s total bill for the PPI scandal has topped £40 billion.

Just days before the latest FCA announcement, Santander was subject to action by the competition watchdog, the Competition and Markets Authority (CMA), for failing to follow its rules on PPI. The CMA requires banks to send ‘annual review’ letters to certain customers – letters which inform them of the cost of PPI and remind them of their right to cancel the policy. Santander failed to do this in the case of more than 500 customers, and has now been forced to enter into an agreement with the CMA under which it will write to affected customers apologising for its oversight and offering refunds if policies are cancelled within six months of the date of the apology letter.

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