PPI complaints to hit record levels, financial ombudsman says
The financial ombudsman expects to handle record numbers of payment protection insurance complaints next year as the fallout from the mis-selling scandal continues.
In its proposed plans and budget for 2017-18, the Financial Ombudsman Service (FOS) anticipates it will resolve 360,000 PPI complaints during that year and it proposes to resource its operations based on these expected levels.
The FOS, which clears up disputes between consumers and financial firms, said it expects to have resolved 170,000 PPI complaints across the financial year 2016-17.
The service has received 1.6 million complaints about PPI in total - and it still gets around 3,000 new complaints a week.
The FOS said it believes the number of complaints it receives in the next financial year will be "heavily influenced" by a proposed deadline for PPI complaints.
The Financial Conduct Authority (FCA) has previously proposed that a deadline of June 2019 could be set for PPI claims and it is due to make a further announcement about this in the first quarter of 2017 after considering feedback.
Ahead of the proposed deadline, there would be an awareness-raising drive to alert consumers who might have cause to complain about PPI. The FOS said it is possible this campaign might also raise consumers' awareness about their right to complain generally, and as a result it could also see more complaints about products other than PPI.
Claims management firms could also ramp up their own advertising during this period, resulting in more complaints, the FOS said.
PPI is the most complained-about product the FOS has ever seen. It was often added to credit cards or loan agreements without consumers wanting it or it being suitable for them. In some cases, people may not even have realised they had PPI
Under complaint-handling rules, firms have eight weeks to look into a consumer's complaint and issue a final response - and if the consumer is still unhappy, they have a further six months to refer the dispute to the FOS.
The financial ombudsman said this means that even with a June 2019 deadline, it is likely that it will still be receiving PPI complaints into 2020-21.