Most customers who have paid for policies added to loans or credit cards from major banks either without their knowledge or without them fully understanding the implications are grateful when they finally received compensation for mis-sold PPI.
In another depressing example of giving the bare minimum to consumers they have already wronged, is anyone therefore really surprised that several banks and credit card providers have short-changed customers who were due compensation for mis-sold payment protection insurance.
An estimated shortfall of £1billion may have been underpaid because firms failed to take into account additional charges levied on customers and left these out of the compensation calculations.
The FSA ordered credit companies to recompense billions to customers themselves rather than each one going separately through the Financial Ombudsman Service and gave the companies instructions on how this compensation should be calculated. And, that is the nub of the matter.
Gratitude is what the banks have been counting on. They don´t expect the victims to recognise they have been underpaid compensation and even if they do, how many people will have the appetite to spend even more years fighting the battle to get back the money they are due.
Credit companies and banks are secretive about how they arrive at payout figures for individual customers, claiming it would 'breach commercial confidentiality'. This opaqueness has led to one victim being paid £5,800 when they should have been £13,000. Finally, after two years of haggling during which time even the Financial Ombudsman Service had failed to rule in favour of the customer the bank finally agreed to honour the amount owed. This is just one example, but there are hundreds of similar cases where the total amount has not been recompensed and the financial companies are seeing this as the way to continue robbing their customers.
According to estimates by consumer group Which the total amount put aside by banks to compensate PPI victims has reached £22.4billion.