The Financial Services Authority announced an agreement today with Barclays, RBS and Lloyds Banking Group granting more time to handle Payment Protection Insurance (PPI) complaints.
The new arrangement will ensure that the firms handle the PPI complaints properly. The firms were facing difficulty with the ‘huge backlog’ of stayed PPI complaints. The extension will help them deal with backlogs and high volume of new complaints. FSA rules currently stipulate a response on PPI complaints within eight weeks.
The extension allows a timeframe to the firms for dealing with claims that have been put on hold and also grants more time to deal with new complaints received since the judicial review ended to investigate their involvement.
FSA said PPI complaints with the firm put on hold due to judicial review will be decided by the end of August.
The city regulator said strict conditions have been laid for the granting the temporary extensions. The firms granted with temporary extensions must keep the PPI complainants and their customers fully informed and also keep FSA updated with compliance status report regularly.
FSA expects all PPI complaints handling to become the eight-week standard compliant by January 2012 at the latest.
“We want to see all PPI claims for compensation dealt with swiftly and appropriately”, said Margaret Cole, interim managing director of the Conduct Business Unit of FSA.
“However some firms are facing a huge backlog and now a surge of new complaints which has created a bottleneck. It is not in the interests of consumers to receive further poor handling of their complaints as a result”, she said justifying the current move by the regulator.
“This temporary extension means that these firms can process these complaints properly and fairly. We will be monitoring their progress carefully to ensure the new deadlines are met, that complaints are dealt with as promptly as possible and the backlog is cleared as a matter of urgency”, she assured.