PPI point of sale ban deferred

19/10/2009

Banks have won an apparent reprieve, following the decision of the Competition Commission (CC) to ban point of sale Payment Protection Insurance (PPI).

The Competition Appeal Tribunal has ruled that the CC should make amendments to its current plans for imposing restrictions on the cover.

PPI works by helping to meet loan payments for policyholders who suffer a sudden lifestyle change, such as being made redundant.

However, the insurance has attracted criticism from consumer groups for being sold as a "default" option alongside the loans - despite the fact that it is a standalone product which requires separate premium payments.

It was these objections which led to the CC's original point of sale ban.

Commenting on the decision, Doug Taylor at Which? said: "It's disappointing that the point of sale ban can't be enforced for now but the tribunal has left the door open for one to be imposed in the future.

"The [CC] must now come back with a stronger case for a ban. This is just a reprieve for point of sale, not a let off."

Barclays made the original appeal against the point of sale restrictions that was considered by the tribunal.

Tags; Debt Management and Banking, Credit Card Lifestyle,

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