Packaged Bank Account Claims
Packaged Bank Accounts, or Paid For Bank Accounts as they are sometimes referred to are soon to be big news. Brace yourselves, you may well be hearing about these on the same sort of scale as PPI!
A Packaged Bank Account is basically an account that includes a monthly fee ranging from £5 – £30 in return for various insurance products, most commonly travel insurance, mobile phone insurance and vehicle breakdown cover to name a few.
With 10 million of these accounts active today it’s estimated at least 1 in 5 of us have one. There could well be millions of these accounts that are no longer active, but claims can still be made against these so don’t be put off if you used to have a Packaged Bank Account, we can still help.
Just as PPI, these have been mis-sold on a staggering scale, in order to generate profits for the greedy banks that would make your eyes water. There are so many reasons for a mis-sale, and we’ve talked about this previously.
Rise in complaints
In 2013 there were nearly 6,000 Packaged Bank Account claim complaints made to The Financial Ombudsman Service (FOS). It’s important to remember the FOS don’t see the full 100% of complaints, only the ones rejected by the banks.
In the 2012/2013 tax year the FOS saw 1,629 complaints made so overall we estimate that there was less than 5,000 made in that year. This grew significantly the following year, 2013/2014, as the FOS recorded 5,668 complaints, thus giving an estimated 17,000 complaints made to the bank in total.
This year there has been a rapid increase to 400 daily Packaged Bank Account complaints made EVERY DAY to the banks. At that rate we can expect 146,000 complaints to be made this year, an increase of 870%!!!.
Complaints made about the mis-selling Packaged Bank Accounts now accounts for 17% of complaints made to the FOS, with PPI still taking up 77% of complaints.
As complaints about PPI start to drop a little, and it is just a little, Packaged Bank Account claims is the fastest growing area of complaint being dealt with by banks and the FOS. We estimate that Packaged Bank Account claims could well hit the heights that PPI has, given the fact that it’s easier to spot than PPI, which was often hidden away in the small print, whereas a Packaged Bank Account can be spotted by simply checking if you pay a monthly fee for your account.
What is it worth?
We are of the opinion that the compensation bill for the banks is likely to run into the £BILLIONS, much a with PPI.
The banks have yet to come out and state what they believe the cost of paying compensation will be, probably because they don’t want to highlight the fact they’ve been caught cheating AGAIN.
They will eventually have to put a figure on things, although we wouldn’t be surprised if the majority of the banks, including HSBC (including First Direct), Lloyds (including Halifax and Bank of Scotland), Santander (including Abbey and Alliance & Leicester), Barclays and RBS (including NatWest), place their initial estimations at a relatively low figure.
The banks don’t want to advertise the fact they’ve been cheating, nor do they wish to startle investors and shareholders by stating what the true cost of the scandal could be.
A clear example of this is the PPI scandal, where banks have consistently reported a much lower figure to what we believe the eventual cost will be. In 2012, the banks released a statement stating their belief that the final PPI bill will be £25 billion. They haven’t changed this stance, even when they recently had to add £3 billion in the space of 6 weeks to the compensation pot, taking it to £24 billion. With an estimated 7 million people yet to claim PPI compensation, we believe the final figure will surpass £30 billion with ease over the course of the next 18 months.
We expect the banks to use the same tactics when it comes to dealing with, and reporting on Packaged Bank Accounts, but don’t be fooled, this will be a huge number.
Potentially £BILLIONS in compensation
Our experts have looked closely into just how much this new scandal could end up costing the banks, and the figures are huge, so let’s take a closer look to see how we estimate that the total bill could run into the £BILLIONS.
- There are estimated to be 10 million active paid for bank accounts in the UK
- Banks are accepting liability on a large percentage of complaints made
- The Financial Ombudsman Service then find that a significant % of rejected complaints were in fact mis-sold
- This sees that the majority of Packaged Bank Accounts have been mis-sold
- Based on 10 million accounts being active, even if 1 in 2 were mis-sold, that is 5 million
- The average compensation payout, based on our figures is above £1,000
- So, even based on conservative figures, 5 MILLION mis-sold accounts at an average of £1,000 = £5 BILLION!!!
This figure doesn’t even take into account the thousands, or even millions, of Packaged Bank Accounts that have been closed!!! You are still able to claim on a closed account so our figure may well be an underestimation.
Your Money Claim are the experts in recovering compensation for mis-sold Packaged Bank Accounts, and mis-sold PPI.
Your Money Claim carry out the necessary checks, build your case, deal with the banks (and their tactics) every step of the way and keep you updated with the status of your case throughout. Taking the stress and time out of making a claim, and beating the banks every day is what we do, so why not start your claim today?