Millions of credit card and loan customers were left celebrating yesterday as the banks revealed they were giving up their legal fight regarding their illegal selling of Payment Protection Insurance (PPI).
A High Court judgement which upheld rules made which insisted on banks contacting all the victims of their mis-selling will not be appealed by the banks, and their industry body, the British Banker’s Association.
It’s been estimated that £9billion worth of payment protection was paid during that period. Customers will now be contacted to see if they were one of the hundreds of thousands of customers who were mis-sold the scheme.
Customers were sold PPI policies to help protect them if they defaulted on the loan, mortgage, or credit card payments, should they be made redundant or become sick.
For many of the customers, the scheme didn’t work, and making a claim was almost impossible.
Banks have been trying to avoid paying back the money, having already paid some customers back, through appealing in the courts.
Barclays and Lloyds last week dropped out of the appeal, with the rest of the banks announcing yesterday they were going to follow suit.
Martin Lewis from MoneySavingExpert said, “This is a wonderful day for consumers. For once the banks have done the right thing and backed down.
“As much as £9billion that was wrongly taken from consumers could now be paid back – an economic boost as money from banks’ coffers will move into the pockets of real people.”