Banks and building societies in the UK are set to invite customers who have not yet launched claims for payment protection insurance (PPI) to do so, it has emerged.
The Financial Services Authority (FSA) has issued guidance to companies in the industry that mis-sold this product on how they should go about the process of getting in touch with people affected by this issue.
Lenders have been advised they must communicate clearly in writing with individuals impacted explaining why they may have been incorrectly sold PPI and how exactly they can claim compensation.
Martin Wheatley - managing director of the FSA, which operates under the Financial Services and Markets Act 2000 - observed: "We think that the redress due from this process may well exceed what has been paid so far and that is why we are acting now to clarify our expectations."
Furthermore, the body insisted all correspondence with individuals should not include any marketing material or financial jargon.
By Asim Shah