Regulation  

FCA slams building societies’ PPI complaint handling

The Financial Conduct Authority is considering whether a number of banks should face regulatory action after it found there was “significant room for improvement” in the way payment protection insurance complaints are being dealt with.

The Financial Conduct Authority today (25 September) published the findings of a complaints handling review of 18 medium and small sized firms currently handling PPI complaints.

The review found that while some firms are handling complaints in line with our expectations, for others, there are still significant issues that need to be put right.

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The FCA found serious problems with complaint handling decisions and communications to customers at two thirds of the firms reviewed (12 of 18).

The FCA is working closely with firms to help improve their complaint handling processes to a level that consumers would expect and to remediate any detriment that may have occurred.

The review covered smaller high street banks, building societies, credit card providers and personal loan companies.

Together, they account for around 1m complaints, which is about 16 per cent of all PPI complaints.

To date, these firms have paid £1.1bn of the total redress paid out to consumers, which now stands at nearly £12bn.

Clive Adamson, director of supervision at the FCA, said: “We expect firms to deliver fair outcomes to PPI complainants. In our review, we found that some firms are doing this while it is clear others still have some way to go.

“I am encouraged that the firms in scope of our review have taken immediate steps to put in place the necessary remedial measures and I expect them to ensure they have robust processes in place to work through the remaining complaints, so that eligible complainants can be paid out as quickly as possible.”

The FCA also published the amount of PPI redress paid out in July, which was nearly £528m.

This was up from £498m in June and marks the first time in 2013 that more than £500m has been paid out in any one month.

The FCA has also been assessing the complaints handling of larger firms including high street banks and credit card companies. It will publish the findings of those reviews at a later date.