Barclays Payment Pause Scheme FOS response

kirks21

Hi

I took out a loan through barclays partner finance to pay for a training course to be a driving instructor.

In early 2011 I realised that I had been paying £22 per month in PPS charges. I wrote to Barclays asking for these to be refunded as I didn't know what it was, and hadn't ever asked for it to be added to my loan (also, I had been unemployed for 5 months in 2007 and as a result defaulted on my payments, and then had to go on a DMP as a result. Barclays never told me that I had PPS that is actually meant o cover this)

As Barclays are thoroughly nice people they naturally told me that they wouldn't be refunding anything and told me that I should complain to the FOS which I did back in April 2011.

After only 26 short months the FOS have now looked at my case and have this week informed me that Barclays are now willing to pay me the following as full and final settlement;

• To refund the Payment Pause Service payments made from December 2007 to January 2011 (£799.90)
• To pay 8% interest on the above amounts from the date of payment to the date of settlement
• To pay £75 for the distress and inconvenience i have been caused by this issue.

If my maths adds up that makes a total of £938.89

I'm just a little unsure if I should accept this or ask for an ombudsman to review the case. The part that is really grating is the fact that Barclays only want to offer £75 as compensation, even though they could have sorted this out nearly two and a half years ago, and have forced me to go through the FOS who are clearly busy. Also, I only finished paying my DMP on full in Dec 2012, which would have been completed much quicker and enabled me to start repairing my credit rating a lot sooner...I feel very insulted by Barclays offer and that is the sticking point for me...

Do I take the money or pass tho the ombudsman? Deal or no deal?

Any thoughts or suggestions from anyone on here would be greatly received!

Many thanks

-taff

The PPI didn't result in you defaulting, you would have anyway. I doubt you went on a DMP solely for that loan.
However, they should have put you back financially in the position you would have been if you didn't have it, since you are actually complaining you didn't need it [ you can't say you didn't need it, then that you did need it but it didn't pay out, it's one or the other].

In any case, the maths is faulty, 37 x 22 is 814, plus sliding 8% simple interest, plus £75 is more than your calculation.

I think there is a defined compensation for distress, I'm not sure whether it's £250.
You can refuse this and ask the FOS to look into it further if you like.

I don't understand why you were still paying this £22 after defaulting on the loan anyway.....but personally, i'd be taking the money.

dunstonh

I'm just a little unsure if I should accept this or ask for an ombudsman to review the case.

You won your complaint and not only are you getting the FCA defined refund but also £75 inconvenience money. That is a good result. The FOS don't usually award inconvenience.

The part that is really grating is the fact that Barclays only want to offer £75 as compensation, even though they could have sorted this out nearly two and a half years ago, and have forced me to go through the FOS who are clearly busy.

It is not your problem that the FOS are busy. Barclays have to pay £850 to the FOS now on top of the redress to you.

Do I take the money or pass tho the ombudsman? Deal or no deal?

You will spend another 18 months waiting for the ombudsman to rule. £75 is good on the scale of inconvenience payments.

I think there is a defined compensation for distress, I'm not sure whether it's £250.

It can be anything from £10 upwards. £250 would have to be significant distress.

-taff

Cheers for info

JuicyJesus

Just to mention - FOS most certainly DO NOT have a defined scale for distress and inconvenience. They assess each issue on its merits. There isn't actually a limit (the link below shows they ruled on over £1,000 in some very severe cases - one of which was the bank letting one of their customers get beaten up by an abusive partner they'd just fled, which from memory they actually ordered £3,000 compensation for) but MOST compensation for distress tops out at around £250. A lot of complaints for "distress and inconvenience" get nowhere near this (and a lot more are very overblown).

http://www.financial-ombudsman.org.uk/publications/technical_notes/distress-and-inconvenience.htm

-taff

Again, cheers for the info