With news that the UK is already back in recession, PPI redress could be even more important.
According to consumer group Which? the overall cost of mis sold payment protection insurance is estimated at £7.6bn. However, taking into consideration the additional costs the scandal has created, such as staffing bills to tackle the hefty backlog, some are predicting the bill to tip the £10bn scale.
Two thirds of the total cost is estimated to solely cover PPI compensation claims, of which it is believed between £3bn and £6bn will be received by customers this year. While, in the current financial climate, consumers may be a little more frugal with any compensation they receive, there is some expectation that many will plough their redress back into the economy and splurge.
Professor Peter Spencer of York University is an Economic Adviser to the independent Item forecasting group. He is confident the PPI redress could have a positive impact:
“These figures should impact the big picture. We have been looking at the Olympic Games, where consumer spend should be as much as £7bn. This is potentially similar.”¹
It is estimated that 40 million payment protection insurance were sold to customers who took out a loan or credit card. In many cases, the customer neither wanted, nor needed or even knew about such a policy.
According the Financial Ombudsman Services, the average PPI payout is £2,750 although there are cases where payouts have exceeded £30,000. PPI Return recently received an offer for our biggest amount to date, a whopping £143,441^.
To find out if you could be entitled to PPI compensation, contact us
¹This is Money (Jan 2011)
Content correct at time of publication