All recent figures have suggested that the volume of payment protection insurance (PPI) complaints is gradually decreasing. However, the latest figures from the Financial Ombudsman Service (FOS) show that the number of PPI cases submitted to it in the second half of 2015 was 92,667, which is only a slight reduction on the figure for the first six months of the year of 94,091.
Complaints about products other than PPI were down 10% since the first half of the year, at 71,663. Investment complaints were down by as much as 22% to 2,898.
Two subsidiaries of Lloyds Banking Group occupied the top two positions in the new cases list. Between July and December the FOS received 22,089 complaints about Bank of Scotland and 21,304 about Lloyds Bank. Barclays came third with 17,781. When we look solely at PPI complaints received during the period, these three institutions again occupy the top three positions.
With all that has been said about a new culture in banking, the numbers of PPI complaints being upheld by the FOS remain high. If the FOS finds in favour of the customer, it is essentially means that it believes the complaint was rejected unfairly, yet 69% of the PPI cases closed by the FOS between July and December were decided in favour of the complainant. This figure compares to an uphold rate of 53% across all financial products. Indeed all the other categories – banking & credit, investments, life & pensions, mortgages & home finance and general insurance (other than PPI) – had uphold rates of 37% or less.
Furthermore, many institutions still have a very high uphold rate for PPI cases. In the second half of the year, this figure was 94% at Clydesdale Bank, 91% at Lloyds Bank, 80% at HSBC, 77% at Royal Bank of Scotland (RBS) and 75% at Co-operative Bank.
In contrast, four well-known firms have a PPI uphold rate of 10% or less, suggesting that they are treating customers well when handling their complaints. These firms are Coventry Building Society, Nationwide Building Society, Bradford & Bingley and Yorkshire Building Society.
Chief ombudsman Caroline Wayman said:
“Complaints about PPI still continue to make up over half of our workload. During 2015, PPI complaints finally began to approach stable levels – but we’re still seeing the volume of cases at a much higher level than many people expected.”
The regulator, the Financial Conduct Authority, has announced plans to introduce a deadline for PPI complaints sometime in 2018. It seems that, without far-reaching action of this type, the PPI mis-selling saga could continue for some time yet. Perhaps in anticipation of a spike in PPI complaints as a result of the proposed deadline, Lloyds Banking Group has increased its PPI compensation provision to £16 billion, of which £12.5 billion has already been paid out. RBS has also recently announced an increase its PPI reserve to £4.3 billion.
The information shown in this article was correct at the time of publication. Articles are not routinely reviewed and as such are not updated. Please be aware the facts, circumstances or legal position may change after publication of the article.