Packaged bank account complaints rose by 42 per cent according to the Financial Ombudsman Service. While PPI numbers have gone down by 9 per cent, PPI still takes up majority of the Ombudsman’s workload.
Bank employees who offered you a bank account with some “freebies” or “perks” you may consider as packaged bank accounts. What people complain about? When it came a time they needed to use the travel insurance or car insurance with their account, they weren’t eligible.
It’s a classic case of payment protection insurance mis selling except it isn’t travel insurance. It’s expensive sickness repayment for your loan for a year when something unfortunate happens to you.
But to be honest, PBAs aren’t bad products. Well some of them. Some consumers report their PBAs to have awarded them with life-saving travel sickness insurance. Some said it had given them a chance to enjoy the benefits of insurance whenever needed.
In this case, PBA won’t amount much to PPI. It’s because banks didn’t pressure-sell the product and instead explained the product carefully.
But of course, the consumer is not at fault when they get a useless perk in their Packaged Bank Accounts. The burden of proof rests with the bank employee. And because nobody has to disclose their PBA commission to customers after sales, it pars lower against the PPI scandal.