Further blow to banks that stand to lose out on £1.4bn of excess profit.
The Competition Commission is poised to ban banks from selling payment protection insurance at the same time as loans, according to a report in the Financial Times this weekend.
Instead, banks would have to delay their sales pitch for several days after offering a loan, allowing customers to shop around.
The Competition Commission is also expected to instruct banks to stagger premium payments.
The commission, which has been investigating the sale of PPI for the past 20 months, is expected to publish a report at the end of this week. In an earlier report, it said the banks earned £1.4bn of "excess profits" through the sale of PPI.
