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Is Payment Protection Illegal

Many people in the UK right now are asking the question, "Is payment protection Illegal?" The truth is that payment protection or PPI is not illegal in itself but the way in which it is often sold is illegal. For example, a person who is covered by PPI and actually qualifies for it, meaning he/she could be approved for a repayment claim is going to be just fine with PPI. The problem is there are only a very small percentage of people, about 13% who can actually be covered by PPI. This means that the rest of the people are being mis sold PPI. This is a pretty large percentage of people and this is why the question, "Is payment protection illegal?" keeps coming up.

Lenders Who Mislead

We really don't want to go as far as to cry fraud but in some cases it is very tempting. There are many lenders who push mis sold payment protection as a way of doing business on a day to day basis. If these lenders have been made aware time and again that what they are doing is unethical and illegal but continue to do so then what other conclusion can you draw? However, for the sake of being politically correct we will simply say that there are many lenders in the UK who mislead their borrowers into purchasing PPI that they do not need and will never, under any circumstances be able to use. For example, lenders are all very much aware of the fact that there are age restrictions and other criterion that people must meet in order to receive cover but they seem to overlook this and sell the policies anyway. This is why when considering, "Is payment protection illegal?" you must realise that there are many different angles in which this can be seen.

More People Excluded Than Covered

Another reason people generally ask, "Is payment protection illegal?" is because they truly feel it should be. If anything else was affecting such a large portion of the population in the UK it seems that something might be done about it. In this instance the government is taking baby steps when what is really needed are drastic measures. No lender should be able to sell a PPI cover unless the consumer it is being sold to qualifies, knows he/she is buying and of course approves it. If this were always done then there would be no scandal about PPI at this time.

What Steps Are Being Taken?

As mentioned above, baby steps seem to be in the works at this time. Sure, some high street banks have been fined and penalized but this just does not seem to be enough. With that being said some very good things are happening. The first of which is that a super complaint was lodged by Consumer Affairs Bureau (CAB) and because of this the FOS, Financial Ombudsman Service, has taken special notice of the matter. This may help people to feel just a little bit safer for what the future holds in terms of PPI.

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