The Financial Conduct Authority (FCA) has decided to consult – by the end of the year – on the introduction of a deadline by which consumers would need to make their PPI complaints or else lose their right to have them assessed by firms or by the Financial Ombudsman Service (the Ombudsman).

The FCA intends to consult on a deadline falling two years from the date the proposed rule comes into force. The UK regulator does not anticipate the rule to come into force before spring 2016, hence PPI consumers would have until at least spring 2018 to complain.

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The consultation will set out FCA’s plans for a proposed communications campaign designed to prompt consumers to complain in advance of that deadline.

The FCA has also decided to consult on proposed rules and guidance concerning the handling of PPI complaints in light of the Supreme Court’s decision in Plevin.

The Plevin judgement concerned a claim about the non-disclosure by a lender of the level of commission on a PPI contract.

Over £20bn redress has been paid to over 10m consumers so far. FCA found that the large scale payment of redress has been accompanied by other trends. For example, the evidence collected by the regulator found:

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– a high and growing proportion of complaints are made via claims management companies, with fee costs to the consumers who use them;

– a high and growing proportion of complaints relate to older sales (pre-2005 and even pre-2000), where the documentary evidence held by firms and consumers is likely to have significant gaps and recollections and oral evidence are becoming increasingly stale;

– a significant proportion of complaints made turn out not to have involved a PPI sale;

– a number of those consumers who told FCA they intended to complain, also said that they had not yet got around to doing so. The open-ended nature of the complaints-led approach appears to contribute to this consumer inertia – i.e. it does not incentivise consumers to check whether they had or have PPI or progress complaints in a timely fashion.