Consumers believe PPI is compulsory with credit
Payment protection insurance (PPI) is still being mis-sold to customers, according to a survey conducted by Which?
The consumers' organisation estimated over 9.8 million people in the UK have a PPI policy alongside a credit card. Of these, it said, 13% thought taking out the product was mandatory with their loan or would improve their chances of being granted credit. It also posited that credit card PPI was the second biggest selling product in the PPI sector, accounting for £970m worth of sales.
Doug Taylor, personal finance campaigner at Which?, said: "In this time of economic uncertainty, people are effectively throwing away £970m each year when they should be encouraged to seek independent financial advice about protecting their finances as a whole. No one should have to take out PPI on their credit card."
However, the organisation has been criticised by Paymentcare.co.uk which said Which? was misleading customers with a blanket condemnation of the PPI product.
Shane Craig, managing director at the provider, said: "While it is definitely the case that lenders' own PPI is exorbitant and cannot be recommended as a good buy, the message put across by Which? fails to tell consumers that there are very affordable alternatives from independent providers."
He added: "Considering the current economic climate, personal debt levels and dismal employment figures, it is irresponsible to tar everyone with the same brush and mislead borrowers into believing they have an all or nothing choice."