The Financial Services Authority’s consideration of a PPI claims deadline angered many consumers, critics and consumer groups. Many cried that it was unfair and unlawful and other said that PPI already had a six-year deadline from 2010. The FSA has not yet issued a final date, but is considering the decision based on consumer fairness, economic development and finally putting an end to the uncertainty of the PPI issue.
PPI or payment protection insurance is a policy designed to repay your loans in case you get sick or get unemployed. Many customers cannot use the insurance policy being ineligible or because they do not really need it. Bank employees usually sell PPI on a pretext of being a requirement or something that increases the chances of a financing application success. Most consumers make a claim for PPI by making a PPI template letter that is sent to the bank, the Financial Ombudsman or claims management companies.
Confederation of British Industry director-general John Cridland first proposed the PPI claim deadline and the British Banking Association pushed the envelope further. Both organizations said that it was time the UK financial industry rebuilt its capital and finally moved on from the PPI claims crisis to support the UK’s stagnating economy.
However, critics and consumer groups blasted the consideration of the FSA and the two organizations. Martine Lewis of moneysavingexpert.com said that it was “immoral” for banks to push for a deadline as early as April 2014, the first date considered by the FSA. He said banks had 10 years to mis sell PPI to customers so customers should have at least that amount of time to make their claims.
Peter Vicary-Smith, CEO of consumer group Which? said that banks placed a six-year deadline for every customer contacted to make a PPI claim. However, the present deadline proposed was unfair because the banks never did a fine job of informing their customers about making a claim.
