PPI victims to get 'no quibble' settlement from bank
Barclays today announced plans to compensate tens of thousands of customers who were mis-sold payment protection insurance on a no quibbles basis.
The group, which has set aside £1bn to cover its redress programme, said anyone who complained on or before April 20 would have their complaint settled in full as a "gesture of goodwill".
But other consumers may have to wait for longer before they find out if they will receive any money back, after the City watchdog announced an extension to the timeframe in which banks must deal with PPI complaints.
The Financial Services Authority said it had granted a temporary extension to the time limit in which Lloyds Banking Group, Royal Bank of Scotland and Barclays had to deal with complaints on the issue due to the huge backlog and high volume of new complaints that the groups face.
Instead of having to deal with the complaints within eight weeks, the banks will have until August 31 to resolve mis-selling claims that were put on hold during the judicial review.
They will also have 16 weeks in which to handle complaints that were received after the judicial review but before the end of August and 12 weeks to process ones received between the end of August and the end of the year.
The FSA said it had granted the extension to ensure that complaints were handled properly, but taxpayer-backed Lloyds Banking Group and RBS are likely to come under pressure to follow Barclays' lead and settle all claims in full.
Peter Vicary-Smith, chief executive of Which?, said: "Banks have a lot to do to re-build their reputation after over a decade of mis-selling PPI and then mishandling complaints about it.
"It's fantastic to see Barclays stepping up in this way, acknowledging their mistakes and refunding customers what they're owed, no questions asked.
"Hopefully this will have a domino effect and other banks will follow suit - the sooner the banking industry can consign the PPI mis-selling scandal to the history books, the better."
The banking industry last month dropped its legal challenge over whether new FSA rules on PPI mis-selling claims could be applied retrospectively.
The move means more than three million people are in line for compensation, expected to cost firms between £7bn and £9bn.
Lloyds has made the biggest provisions for compensation at £3.2bn, while RBS has set aside £850m and HSBC £270m.