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Packaged bank accounts and payment protection insurance (PPI) are still leading the way with the complaints. It may not be a surprise to the countless people who have endured cold calls and emails from providers, but the Financial Ombudsman Service (FOS) confirmed this month that claims management companies still constitute the majority of new complaints to the organisation, and most are made about payment protection insurance (PPI) and packaged banks accounts. What’s more, the issue only seems to be snowballing.
During the first six months of the year, the number of complaints registered by the FOS rose by 8% to 173,994 new cases between January and June 2015. On top of this, over half of the cases that were opened by the ombudsman were upheld.
Considering the PPI scandal started back in 2011, many people are understandably surprised by the continued volume of recorded phone call messages and leaflets through letterboxes, and while the problem seems to be at least slowing – PPI complaints to the ombudsman fell 10% in the first six months of the year – complaints are still very much forthcoming.
Yet as one financial money-maker has started to quieten down after four years of popularity, another has begun to replace it: claims management firms have started to focus their resources on packaged bank accounts. These are accounts that offer customers additional features, such as phone insurance or preferred loan rates. However, their use by third parties has led to non-PPI cases jumping by a whopping 45% on 2014 figures.
Caroline Wayman, chief ombudsman at the FOS, said: “Though the number of new PPI cases has reduced in the first half of this year, the decline has not been as steady or as marked as generally expected. This is as least in part due to the continued high levels of activity by claims managers in this area.
“Claims managers have also been largely responsible for the substantial increase in complaints about packaged bank accounts, which have driven up our banking workload over this period by two thirds.”
Founded in 2006, the Financial Ombudsman Service has exploded in staff numbers; according to the Guardian, it has gone from 100 employees to over 4,000, mainly because of the PPI scandal and “customers unhappy with the product or their bank’s redress process”.
- Author bambooloans
- Posted 22 September 2015