Barclays to settle all PPI claims

Customers will be reimbursed the total value of all premiums plus 8% interest.

The bank said the move would affect tens of thousands of customers, particularly those put on hold during a recent judicial review.

Barclays said it was the first bank to pay out PPI compensation on a "no-quibble" basis.

It said its customers had waited long enough because of the long-running judicial review into the affair, and this would allow it to clear the backlog quickly and assess new cases more quickly.

"We can confirm that we are contacting customers whose complaint was put on hold on or before 20 April with an offer to settle their complaint in full as a gesture of goodwill," the bank said.

Huge compensation

In April, the banking industry lost its High Court challenge to new rules on the sale of PPI.

These had been imposed last year by the Financial Services Authority (FSA) and the Financial Ombudsman Service (FOS).

Among other things, the rules require sellers of PPI polices to review all their past sales to see if their customers have a claim for mis-selling, whether or not they have actually complained.

Lloyds Banking Group set aside £3.2bn to cover the cost of this compensation, followed by Barclays (£1bn), RBS (£850m) and HSBC (£269m).

The banks put on hold tens of thousands of fresh PPI complaints that came in while they were waiting for their legal case to be resolved.

Barclays now says those lodged before 20 April will be eligible for automatic reimbursement, while those received since then will be assessed on merit.

Which? chief executive Peter Vicary-Smith welcomed Barclays' move.

"It's fantastic to see Barclays stepping up in this way, acknowledging their mistakes and refunding customers what they're owed, no questions asked," he said.

"Hopefully this will have a domino effect and other banks will follow suit," he added.

Also See

• BBC News
• Barclays