Analysts and experts said that refunding PPI repayments to customers can cost banks more than £25 billion in total just for this year. Currently, £14 billion is the total of the PPI compensation package for the United Kingdom, which is already staggering. However, experts say that the financial industry underestimated their mis selling activities for the past decade.
Experts said that the amount of £25 billion is probably not the final amount of the PPI compensation package; some small detail will lead to the increase of this staggering total. However, they said that it is truly one of the biggest recompense amounts for a financial scandal, putting PPI mis selling as bigger than the pension scandal years ago.
Lloyds recently set aside £1 billion more for PPI recompense, bringing its total compensation to £6.3 billion, the largest of all four major UK banks. The Financial Services Authority recently penalized the bank for an “inadequate” PPI repayment system that cost around 240,000 customers to wait for more than 28 days to six months in getting their compensation.