| PPI Refund

Generally, the major aim of all the financial institutions is to cater to the financial needs of their customers. Be it a lack of money, handling excess of money, dealing with valuables or ensuring their financial status. As a financial organisation, it is their duty to carry out their services in the best possible manner and make sure that their customers are never dissatisfied. However, is that the case always? It never is!

Based on the current scenario of the financial sector in the country, the agencies imply, “You give us your money. We would promise to serve you out of it, but would actually invest it further to make money for ourselves and for our employees to get rich. However, when you need us, we’ll flip.” This is exactly what has been happening to the financial and banking sector in the terms of Payment Protection Insurance (PPI). Recent history proves that out of all the companies and agencies operating under the name of ‘Financial Services’ are often disappointing their customers while doing great for themselves. So is the case with the issue of PPI refund. Since more than a decade, the policy was being mis-sold to many innocent and ignorant buyers. They were sold the property while sanctioning a loan or credit, or were not completely informed about all the terms of the policy. This resulted in the customers getting drained off their money and the lenders filling up their treasuries with the same amount. Even after it being over a decade since the scandal first came into light, thousands of mis-sold buyers are still waiting to receive their compensation in the form of PPI refund from the concerned financial institutions.

FOS Complaint Figures Tells Its Own Story

Take some time and go through the latest complaints being filed with the Financial Ombudsman Services (FOS). Majority of the reported cases are regarding the mis-selling of PPI. Also, most of the remaining cases deal with the inefficiency of services provided by the financial institutions. The number of cases received by the FOS went up by 13% to 170,000 in the first six months of the year. Caroline Wayman, the Chief Executive also confirms that most of the complaints about financial products have been on the rise since a long time. In other words, the surge is not just down to the publicity given to the longstanding bugbear of payment protection insurance mis-selling, which is getting a lot of extra attention thanks to a campaign launched on the back of the Financial Conduct Authority caving into the banks and agreeing to draw a veil over the affair in a couple of years. 

At this point, it is worth noting that the affected customers can only approach the Ombudsman after exhausting the in-house complaints procedures regarding the company they are dealing with. When it comes to PPI, the financial institutions and the banks have been doing a lot by themselves to make sure that the needs of their ms-sold buyers are met. Major banks are setting aside a huge sum of money in order to take care of their PPI provisions. This amount has also increased considerably over the period of time. However, this is not sufficient enough for the FOS to be relieved of the complaints relating to PPI, as the number of claims received by the lenders is much higher than the number of cases solved by them. This imbalance is what is perceived as lack of services, leading to a further increase in the already erupting volcano of PPI complaints at the Ombudsman.

Whats The Solution?

Step1: Honesty

One of the ways in which this issue can be solved is by giving a prompt solution of the buyers’ problems by the financial institutions. If the problem is solved in the first stage itself, it would never find its way to the Ombudsman. Also, the banks need to be more honest to the customers. Recently, there have been cases where the banks have asked their customers to give them a part of their PPI compensation back on the grounds of miscalculation. The banks claim they have given them an amount that is higher than what they were supposed to pay off as compensation. Looking at the burden of complaints coming to the banks, it is fair to assume that they may be facing difficulties in calculating the exact amount. However, this has often proved to be the other way round and the banks have been perceived as financial cheaters. No matter how much they justify their actions, they will always be blamed for asking back the money from their customers. This also makes the customers lose their trust in the institution. Now, instead of reducing the complaints, this would lead to more complaints being filed against the concerned financial organisation.

Step2: Improved Customer Interaction

Any firm dealing with the ‘financial services’ tag should make sure that they don’t treat their customers in a shabby manner. They should always make sure that they are doing their best when it comes to their finances and helping their customers out in solving their issues. If a customer complaints regarding the issue of mis-sold PPI, the institution can start working on document verification and solving of the case, instead of just asking the customer to wait for an eternity for the resolution of their claims. Also, the services provided by the financial institutions should be proper and precise. They need to be aware about every aspect of the market.

If a PPI policy is brought to them, they should be smart enough to confirm whether the policy was sold by them or not. Inappropriate and casual behaviour by the institutions would only add the burden on to them as well as the Ombudsman. This has been the story at least since a decade when it comes to sorting out the issues of PPI. This is a major reason why the victims are still complaining on a daily basis and have to wait for years to obtain their PPI refund.

All these activities are not only unfair, but also stupid. It doesn’t take much for a financial organisation to be smart and vigilant in handling the complaints. If they fail to do so, they should also be aware of the repercussions which are not so decent. Many of the banks are already wiping out billions off their lockers in order to correct the mistakes they committed out of greed. They are not only piling up cases on their own heads, but are also losing the confidence in the eyes of the public which was once blindly loyal to them. This lose-lose relationship would only lead to chaos and complaints until the matters settle down, either naturally or forcibly.

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