PPI payouts help UK climb out of recession
The huge recession that hit the world from 2008 was something on a scale not really seen by any of us alive today. Runs on banks, banks closing, banks having to be rescued by governments, the world still has a long way to go before it can be considered as recovered.
I suppose one small shred of comfort is that the UK appears to be ahead of the majority when it comes to getting back on it’s feet. But how and why?
Why people stop spending in a recession
It’s clear that the uncertainty that comes with a recession sees businesses and banks try to keep hold of the money they have, rather than invest it.
People stop spending as there are fears of job cuts, pay cuts and a general feeling of uncertainty.
We’ve seen across the globe that governments have attempted, with varying degrees of success, to pump new money into their economies in an effort to try to get the wheels moving. This is known as quantitative easing. There are plenty of drawbacks with quantitative easing though and it’s in no way the answer to the problem.
Banks don’t lend in a recession
The most effective way to get out of a recession is to generate confidence in people and industry to spend money, which isn’t easy. Banks don’t tend to lend money which means businesses can’t grow, which leads to people feeling unsure about their jobs and income, which in turn leads to people not spending. It’s a bit of a vicious circle.
We’ve seen various initiatives by the UK government to try and force banks to lend, with relatively little success. Banks don’t lend as they have their own debts to service, especially with the frankly terrible investments and lending they were doing in the years prior to the crash. They also don’t lend as they’re unsure about whether businesses can grow, or the security of people’s jobs.
Sounds a bit grim doesn’t it?!
Step forward, the mis-selling of PPI
It’s a strange way of looking at things really, but the banks own greed and illegal practises may have just saved the day.
The mis-selling of Payment Protection Insurance (PPI) has been the biggest financial scandal to hit the UK.
The 13 million complaints made so far (just a third of policies sold!) has forced banks and lenders to pay back £16 BILLION to UK customers in PPI payouts, which has seen people back out into the shops, buying cars, putting deposits on houses, paying for holidays and everything else you can think of to do with the thousands of pounds that you may receive.
With this cash injection into the system, businesses have been able to steadily get back on their feet, employ more people and the confidence is slowly but surely starting to return.
Indeed, the UK is now one of the fastest growing economies in the world.
Can this growth be maintained?
The simple answer is yes. Don’t get me wrong, it’s unlikely the banks will be voluntarily helping anytime soon, but the fact they’re being forced to cough up PPI payouts for their own greedy and corrupt past, means that BILLIONS more will be getting paid out to the UK consumer which of course helps the country grow.
The banks expect the final PPI bill to be around £25 BILLION, which would mean another £9 BILLION in PPI payouts is yet to be claimed. However, this is according to their figures and we all know how accurate and trustworthy banks are!
The banks are relying on people with valid PPI claims not coming forward, and the fact that millions of people are out there who, because of the scandalous tactics employed by banks and lenders, still are unaware they’ve even had PPI on their loans, mortgages, credit cards, store cards or hire purchase agreements.
The next mis-selling scandal
The banks haven’t just stopped with mis-selling PPI. The next big mis-selling scandal is upon us, and it’s Packaged Bank Accounts. So, if you pay a monthly fee for your account (usually between £5 – £30), you may have been mis-sold a Packaged Bank Account.
Do your bit for the economy!!!
If you haven’t made your claim for PPI compensation, or Packaged Bank Account compensation, I ask why not?!! Your Money Claim can check whether you’ve had PPI, whether you may qualify for PPI compensation, or qualify for Packaged Bank Account compensation, deal with the banks at every step of the claim, and with the average payout being £3,332** it could be the best thing you do this year.
Not only could you be thousands richer by launching a claim, but you could also be helping the UK to prosper by doing so.
Your country needs you, make your claim today with Your Money Claim.