Sharp drop in PPI complaints
Latest data shows there have been 19,259 PPI cases from July to September this year compared to 56,025 recorded in the previous quarter – a drop of 66%.
The FOS says this dramatic fall in complaints is "as expected".
"The record highs of the previous April-June quarter tie in with when the judicial review was under way. Because consumers were having no luck complaining to their banks they would go to the FOS, during this time," an FOS spokesperson explains.
"But after the review ruling, banks started to reveal how they would resolve PPI complaints themselves so fewer consumers needed to go via the FOS."
However, despite the huge reduction in complaints, PPI is still the most complained about financial product "by some distance", accounting for 38% of all complaints the FOS received during this time.
However, the FOS has upheld 92% of the PPI complaints in the consumer's favour.
Credit card accounts were the second most complained about area, with 5,751 cases reported to the FOS.
Payment protection insurance is designed to cover you should you fall ill, have an accident or lose your job and can’t make repayments on loans or credit cards. However, research by consumer watchdogs found the cover to be overpriced, filled with exclusions (policies exclude self-employment, contract employees and pre-existing medical conditions) and were often mis-sold because the exclusions were never fully explained. In May 2011, the High Court ruled banks had knowingly mis-sold PPI and ordered them to compensate around two million consumers.
If you’ve have a complaint about a financial service product you have bought but the company you bought it from refuses to resolve your problem after eight weeks, the Ombudsman can help. The Ombudsman will investigate and resolve the matter. The Ombudsman is independent and its service is free to consumers. The Ombudsman may find in the company’s favour but consumers don’t have accept its decision and are always free to go to court instead. But if they do accept an Ombudsman’s decision, it is binding both on them and on the business.
Used by the holder to buy goods and services, credit cards also have a monthly or annual spending limit, which may be raised or lowered depending on the creditworthiness of the cardholder. But unlike charge cards, borrowers aren’t forced to pay the balance off in full every month and, as long as they make a stated minimum payment, can carry a balance from one month to the next, generating compound interest. As the issuing company is effectively giving you a short-term loan, most credit cards have variable and relatively high interest rates. Allowing the interest to compound for too long may result in dire financial straits.