RBS and Lloyds refuse no quibble PPI payouts

14 June 2011

Royal Bank of Scotland and Lloyds Banking Group will not follow in the footsteps of Barclays and offer automatic payment protection insurance payouts, it has been revealed.

Barclays announced yesterday it would pay out some of its customers' PPI complaints on a quibble-free basis, following the High Court ruling on the mis-selling of PPI by high street banks.

Customers whose complaints were put on hold during the Judicial Review or those who put in a complaint before 20 April will now see their claims resolved and paid out in full as a "gesture of goodwill without any admission of liability".

However, government-backed banks Lloyds Banking Group and RBS will not take this approach. Instead, both will assess claims on a case-by-case basis.

A clear response

Kath Allen, spokesperson for RBS, says: "We are taking active steps to process all complaints within the Financial Service Authority's (FSA) timeframes. We remain focussed on making sure our customers get a fair outcome within those timeframes."

Anyone who made a claim before 20 April will have a decision by 31 August.

PPI complaints received after 21 April but on or before the 31 August will be responded to within 16 weeks and PPI complaints received on or after 1 September and before December 31 will be responded to within 12 weeks.

Read: How to reclaim your PPI benefits

Charlotte Sjoberg, spokesperson for Lloyds Banking Group, says: "We are handling all PPI complaints fairly and consistently regardless of when they were received. We will ensure that we provide a clear response to every customer that has submitted a complaint to us before 6 May by the end of August.

"For customers who have submitted a complaint on or after 6 May, will we provide a full response within 16 weeks of receiving the complaint."

In December last year the FSA issued guidelines on the selling of PPI, explaining when a customer could claim for being mis-sold a policy. It told the banks to apply these guidelines retrospectively. This meant thousands of customers who had already been sold PPI could claim compensation.

The banks claimed this was unfair and the case went to court but on 20 April the judge ruled in favour of the FSA and, eventually, the banks decided not to appeal the decision.

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