The Financial Services Compensation Scheme (FSCS) is designed to compensate customers in the event of their financial service provider failing to deliver satisfactory goods. It is there for people who have been mis-sold PPI, who have lost out through no fault of their own or who have received poor service. The scheme is essentially a pot of money put together through a levy system.

The different financial institutions add a certain amount each year depending on what they provide; banking, insurance, intermediary services and the total is used to refund or compensate customers. With the massive increase in the number of PPI claims has had to come an adjustment in the amount levied and this increase has been big. There has been a 58% increase in PPI complaints over the past 12 months, with over 49,000 new PPI complaints received and 89% of them upheld. To cope with this amount of compensation, the FSCS has set a budget of £61m for the 2010-11 financial year which is nine times that of the previous year.

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2. PPI Claims On The Increase
3. PPI Claims Top The FSA Complaints Chart
4. Mis Sold PPI Claims Reach Record Levels
5. PPI Claims Reach Record Highs