The Sheer Size of the PPI Scandal Exposed

By | July 2, 2013

The payment protection insurance (PPI) scandal has already affected many thousands of people, and with an only estimated 10% of people who have ever had PPI having claimed there are clearly many more out there with legitimate claims to make. Further confirmation that the lenders expect an influx of claims can be confirmed by some of the facts and figures associated with the scandal so far, not least the amount of money they have had to put aside to ensure they can pay back customers who have outstanding claims.

Millions of Policies Sold

It is estimated that, since 2001, some 34million PPI policies have been sold, and so far more than £14bn has been put aside by the various lenders to enable the repayment of customers with mis-sold policies. This figure is fully expected to climb as more claims are made, and is made up of the amounts set aside by all the lenders involved in the mis-selling of PPI, banks and otherwise. With such a small proportion of those with PPI having claimed so far it is difficult to estimate what the final figures may be when all is said and done, but there is no doubt it will be considerably higher.

Lloyds Group the Biggest Player

So far the Lloyds Group has been the biggest contributor to the fund with £6.7bn set aside to compensate customers of its various arms. The group has already paid out over £4bn in mis sold claims. Barclays has a fund of £2.6bn ready to pay back customers, and has spent over £1.5bn so far compensating customers, while the HSBC group has allowed for £1.5bn, having raised its allowance recently in the light of new claims. These are the three major banks involved in the scandal and those that stand to pay back the most.

Making Claims Easier

Despite the High Court ruling that banks must pay back all mis-sold fees things have not been plain sailing for claimants. Some banks have been fined for stalling, and others have been found to have instructed call centre staff wrongly. For those who have yet to claim, visiting may give an idea of the amount owed, and a claim company can give the relevant help and advice that unwary claimants may need in order to help them get back what they are owed. There is, quite clearly, much more to come from the PPI scandal.