When battling the banks and big financial companies, the customer always seems to lose out. The banks made big bucks for many years charging high interest on credit cards, on loans or if you went into your overdraft. It seemed that whichever way you turned the banks were making money from people. They were awarding themselves big bonuses which were paid out of customers’ money. They were making large profits – and one area was the selling of Payment Protection Insurance, or PPI as it is known for short. But now the customer is fighting back. How? By reclaiming the money that the banks took from them by mis-selling PPI.
So how are they doing it? If you were mis-sold PPI you are entitled to reclaim it. This has been going on for some time, and not surprisingly banks were fighting to keep the money which had been paid in. PPI is very lucrative – not surprising as many people could not claim it even if they had it and needed to. PPI had been sold to many people who were unemployed, retired, self employed or had a pre=existing medical condition. None of these could actually claim on their payment protection insurance yet many people in these categories were sold it. To the banks, this was money for nothing.
Even worse, many people were paying PPI without knowing it. It was added to loan repayments without their consent. You should be fully informed about any insurance cover on a loan but some people were paying it for years while being unaware that it was added to their charges – if you were offered a ‘fully protected’ loan then the chances are you have PPI. Sometimes people were told that they had to have it when this was not true. They were not told that they could shop around for a cheaper option. The banks made a large amount of money from PPI and staff got lots of commission so it is not surprising that there were some dodgy deals going around.
The customer is fighting back. First people began to complain, then to claim back the money they had wrongly paid out. The Financial Ombudsman ruled in their favour. Not surprisingly the banks objected, and fought every claim. They used delaying tactics and appealed to the courts. However the courts ruled in favour of the customer. If you were mis – sold PPI you now have the right to claim it back. You are also entitled to claim back interest. Banks have put aside money to pay this and are accepting liability.
So this is a success story for the consumer. Banks can no longer sell you expensive and worthless insurance. You can claim back the money that you needlessly paid out. You can also claim for interest, just like the banks do if you borrow money from them. This is costing the banks millions of pounds, but don’t feel too sorry for them. They took the money in the first place – now the customer is fighting back.