FCA weighs PPI compensation cut off

FCA logo new 3 620x430

FCA directors are to hold talks about introducing a deadline for lodging payment protection insurance claims, Sky News reports.

The misselling scandal has so far cost banks around £25bn in compensation payments.

Recent trading statements shows banks have set aside hundreds of millions more to guard against future claims.

But the regulator is to debate imposing a “time-bar” deadline at a scheduled board meeting today.

A decision is not expected imminently and any changes would likely be subject to consultation.

Following a Supreme Court ruling in May, the FCA said it would investigate how firms could better handle complaints relating to PPI.

Autonomous Research – chaired by former City minister Lord Myners – has estimated the decision could add £33bn to firms’ bills if the judgment was extended to other products.

In 2014, the FCA asked banks to review 2.5 million complaints which it said could have been rejected unfairly or resulted in too little compensation being paid.