PPI saga is coming to an end
This whole business with PPI nonsense is finally coming to an end, it seems. The banks of the UK are nearly out of the woods, with one last round of compensation and new restrictions on claims management companies on the horizon.
One of the big things, even though it has taken an absolute age to come into play, is a proposed cap on the fees charged by claims management companies, which will be brought in by the Ministry of Justice.
Some fees have been as high as 40% of the redress awarded to people, which is ridiculous seeing as you can do your own claims.
One of the measures being talked about, is the limit that will see overall charges for claims (worth more than £2,000) being capped at £300. Typically, the charge is £750. It looks like there's going to be a ban on any company from charging anyone upfront. It has been a booming business, with claims companies raking in £3.5bn since 2011. Of course, there's also the added nuisance of spam PPI texts and emails.
The Financial Conduct Authority (FCA) said last year, that there needs to be a deadline imposed on all this, so we can finally see the back of it all. It is thought that this deadline will be announced sometime in Spring, this year. Of course, this announcement is likely to see a spike in activity from these claims businesses, especially if the cap isn't brought in first.
A spokesperson for the British Bankers’ Association said the ministry’s action should "prevent claims companies from clogging up the system to the detriment of genuine complaints".