BBC: Barclays to settle payment protection insurance claims

Barclays has said it will pay out compensation to everyone to whom it sold payment protection insurance and who made a complaint before 20 April. Customers will be reimbursed the total value of all premiums plus 8% interest.

The bank said the move would affect tens of thousands of customers, particularly those put on hold during a recent judicial review.

No-quibble basis

Barclays claim they are the first bank to pay out PPI compensation on a "no-quibble" basis as they set aside almost £1 billion to cover claims.

The bank said its customers had waited long enough because of the long-running judicial review and their action would allow the backlog of complaints to be cleared and new cases to be assessed more quickly. 

Interest at 8 % 

Barclays state that they will be contacting all those consumers whose complaints had been previously rejected and those whose cases were on hold pending the judicial review and will add 8% interest to their claims. Hopefully this will encourage other banks to soon follow suit. 

FSA changes the complaints timetable

Normally such complaints lodged with the bank would have to be dealt with in eight weeks. However due to a surge of new complaints on top of the existing backlog many companies were struggling to respond within this timescale.

As a temporary measure to help the PPI providers meet this demand, the FSA said that PPI complaints put on hold since the judicial review must now be settled by the 31 August.

Any new complaint received after the judicial review but before the end of August must be dealt with in 16 weeks and any complaints received after August but before the end of 2011 will have to be dealt with in 12 weeks.

After this the complaints procedure will revert to the normal eight week timetable.

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