Customers who lodged complaints over the mis-selling of payment protection insurance (PPI) may have to wait until next summer for a final response.
Britain’s competition watchdog has said it is challenging banks to deal with complaints as quickly as possible following a late surge of enquiries and complaints ahead of the August deadline.
The last-minute flood of claims means that firms will now “not be able to meet their normal complaint handling times”, according to the Financial Conduct Authority (FCA).
Financial firms would usually have two months to respond to claims, but could now take until summer 2020 to deliver a final response to some complaints.
A number of banking giants came under fire at the end of August after suffering a series of IT failures in the run-up to a long-awaited payment protection insurance (PPI) deadline.
Several banks blamed an exceptionally high volume of traffic for the difficulties in the run-up to the deadline, which has brought down the curtain on a major financial scandal that involved banks and loan providers mis-selling policies to people who did not need them between 1990 and 2010.
The 11th hour stampede of complaints caused several major lenders to warn of extra costs to their balance sheet.
It has been estimated by the FCA that roughly £36bn in compensation has been paid out so far, with the typical payout amounting to £2,000.
However, in August think tank New City Agenda predicted that the total PPI bill will likely exceed £50bn.