This comes after the British Banking Association (BBA) abandoned a High Court appeal against the Financial Services Authority (FSA) ruling.
The service offers in-house expertise for a review and redress exercise, or a complete end to end service managed by HML.
HML’s chief commercial and finance officer, Neil Warman said: “In the last week it’s become clear the scale of the PPI redress exercise is much larger than had originally been estimated.”
Last month the BBA said the total industry compensation bill would be just £4.5bn for a 20% take up. Lloyds Banking Group has put aside £3.2bn, Barclays £1bn and RBS £850m amounting to £5.3bn for three organisations.
Warman added: “Around 16m PPI policies have been sold since 2005 and all those with a policy have to be contacted and their case reviewed to see if they are due compensation – with up to 6.4m policies likely to have been mis-sold, that’s an administrative headache in anyone’s book.”
Last month, the FSA revealed that 1.5m policyholders complained about mis-selling, 2m non-complainants are to be paid compensation as a result of ‘systemic failures in sales’ and that there will be approximately 750,000 future complaints.
Warman said that HML’s move into the PPI market will deliver cost savings for financial institutions large and small:
“As an FSA-regulated organisation, we’ve already worked with some of the high street banks on complaints and managed redress exercises for our clients. Having the ability to scale up or down to meet demand will be key to delivering a service that meets customer expectations and is cost-sensitive – something smaller companies will be mindful of.
“Outsourcing some or all of the work involved in the PPI redress campaign could be the answer for some of the smaller players who weren’t expecting to have to manage the exercise so soon, and could provide overspill capacity for the larger players.”
