There are reports emerging that a deadline for PPI claims could be set for the summer of 2014. The date is speculation at the moment, but comes to light as the banks involved in the mis-selling saga call for a date to be applied for when claims must be submitted. Some consumer groups are against the idea and, as yet, there has been no move to confirm a date, but the British Bankers Association (BBA) which represents the UK banking industry is very keen to agree a cut-off time with the Financial Services Authority (FSA).
Potential Solutions put Forward
While there is no concrete agreement it is known that there are a couple of favoured options that the banks and other lenders are keen to implement: the first is that the FSA would implement new rules on PPI claims, which would possibly require new legislation, and the second is that the banks will allow the current system to stand, but will finance a marketing campaign to inform the public of a cut off point in the future. At present, claims can go back for six years, or three depending upon circumstances.
Challenges for 2013
The current challenge for the banks is to handle the many thousands of claims – as many as 5000 each week are being forwarded to lenders by the Financial Ombudsman Service (FOS) – that are expected to be made in the coming year. There have already been moves to outsource the sorting of PPI claims, but this can only help to a certain extent. It is expected that, if an agreement cannot be found as to one of the two suggested solutions above, the FOS will be called upon to make a decision and rule on the way forward.
£25bn Total Costs
The lenders involved have so far paid out some £13billion in mis sold PPI fees, and it is widely expected that this figure will easily exceed £25billion by the time the scandal is ended, whenever that may be. With increased public awareness of the right to claim, and advice available on how best to do so, it is no surprise that such figures are being touted in relation to the saga.