Lenders need to be quick, agile and effective in face of soaring PPI claims, warns Capita
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With the Financial Ombudsman Service (FOS) today revealing that the number of payment protection insurance (PPI) cases it has received rocketed in the last three months of 2011, Tony Tarquini from Capita is urging financial services organisations to take action to avoid further costs.
Commenting on the soaring number of claims, Tony Tarquini, head of financial services at Capita Consulting, said: “I predict that the number of PPI claims will continue to increase in the early part of 2012 as claims management companies continue to promote their cause..However, even though the percentage resolution of claims in favour of the customer has fallen, this doesn’t actually help financial services organisations very much. It is the time and attention needed to establish the nature of the claim, source all the details and data and work with the FOS that makes costs spiral.
“Of course, all claims need to be thoroughly investigated, whether they are eventually proven to be valid or not. I would urge all organisations to ensure they have processes in place that enable them to move quickly, effectively and with agility, so that the claims process is as short and smooth as possible, qualifying out the timewasters as fast and efficiently as possible. Making sure to either employ or work with those who have specific expertise in remediation is also vital.
“The PPI rollercoaster ride is not over just yet, and while it cannot be ignored that the cost implications are huge, by quickly applying robust operational performance techniques, organisations can do some serious damage limitation.
“While putting an effective strategy for remediation in place is of course of paramount importance, it is also vital that banks and lenders look at the bigger picture and how they can learn from past mistakes to avoid similar issues in the future. By managing a remediation programme as a silo, organisations risk losing out on using any knowledge gained to form a cohesive future strategy to retain and regain customer trust. And after taking such a big hit in terms of paying out to customers mis-sold PPI, banks are going to need every possible sales advantage to re-coup their losses,” concluded Tarquini.
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