Over the last year the Financial Ombudsman Services (FOS) has increased its workforce by 25 per cent to help deal with the number of claims for mis sold payment protection insurance.
In total, the FOS has recruited 500 additional staff members to deal exclusively with PPI claims and has confirmed it’ll upsize again if it continues to receive the same volume of complaints next year.
Many of the high street lenders have increased their provisions for PPI compensation in recent weeks; Lloyds Banking Group have set aside a further £2.1bn, taking its total to £5.3bn while Barclays and Royal Bank of Scotland has upped their provisions by £700m and £400m respectively. Payment protection insurance mis selling is now estimated to cost lenders around £12bn collectively.
Natalie Ceeney is the FOS Chief Executive:
“We’ve now received half a million complaints in total about PPI – and so far this year we’ve handled double the number of cases that we had geared up to receive, following public consultation last year.
“Whatever happens, clearly PPI – on top of a growing caseload in other areas – will present us with some major challenges for some time to come.
“We deal with many cases which should already have been sorted out by financial businesses. It is therefore disappointing that we have had to expand so significantly – and our growth is itself an illustration of some of the problems in the industry.”
The Financial Ombudsman deals with complaints when customers and financial services cannot reach an agreement. Ceeney’s comments suggest lenders are wrongly dismissing client claims for compensation, or not dealing with them within the set timescales.