Banks’ mis-selling refunds are putting cash into consumers’ hands
Banks compensating consumers for mis-selling them payment protection insurance (PPI) is bolstering the economy, the Financial Times reports.
The UK’s five leading banks have set aside £9bn to compensate customers for mis-sold PPI. The FT reports that $4.8bn of this had already been paid out by the end of May.
The refunds are acting as a windfall for cash-strapped consumers, and putting money in the hands of those most likely to spend it, the paper said.
It cited one example of a customer who spent her £2,000 PPI compensation on fixing her roof and a holiday in Greece.
Lloyds Banking group has set aside the biggest PPI provision of £4.3bn. Barclays and Royal Bank of Scotland have set aside £1.3bn each. HSBC’s provision stands at £1.1bn and Santander’s £700m.
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