The PPI crisis takes a hefty toll on the UK banking industry’s profits. Lloyds has accounted for an additional £700m for its refunds. Barclays has followed suit with a £700m allocation. Both banks claim these amounts would suffice until the FCA’s PPI claim deadline on August 29, 2017.
UK’s banks and other financial institutions answer to the Bank of England. Stopping the PPI crisis would help the Bank of England’s efforts to improve the economy and implement its policies better; affiliate banks can provide their services to industry stakeholders. However, the crisis, which banks played a huge role in causing, continues to be disruptive to BoE policies.
The FCA’s PPI deadline would help banks rebuild their capital. Banks can then reach out to bigger clients to provide services, which help enforce the Bank of England’s policies.
The only downside to banks getting their way is the lack of improvement in both attitude and consumer policy. Consumer-troubling incentives for work volume motivated employees to sell the policy to ineligible consumers. The £38bn recompense package of the entire industry is a testament to the possible outcome of the deadline for the quality of service from the banking sector.