Is there a time-limit on Packaged Bank Account Claims?

At present, Packaged Bank Account claims are time-limit free.  No outside body, such as the Financial Conduct Authority (FCA), has established the requirement of the Banks to deal with claims by a certain specific time.  They are, however, looking at putting a time-limit in place for new claims for Payment Protection Insurance (PPI) being taken on, which will be some time around spring 2018.  This is not the case however with Packaged Bank Account facilities, and it is unlikely that any form of time-limit will be set by a body outside of the normal complaints process.

The complaints process does have a number of time-limits which need to be factored in when dealing with Packaged Bank Account claims, along with any other type of financial claim.

The first is that when the Banks receive an initial instruction from ourselves (on behalf of the client) they must firstly attempt to locate the information.  From this point, they have approximately 8 weeks to deal with any complaint.  It is important to give the Banks this time to make sure that they research and respond in full.  Sometimes however, this time-limit is exceeded because the Banks are unable to locate information.    This is primarily in the case of older claims.  This is because the Banks have to hunt details, before responding fully.  In that case, we do give the various account-holding institutions a little bit of extra time to locate the information and respond thoroughly.

The next important issue is the time-limit imposed when a claim is resolved.  By resolution, this can either mean a refund (in which case the refund is made) or if the Bank declines the claim, we would then look to forward the claim for adjudication with the Financial Ombudsman.  In this case, we have a period of 6 months to submit the claim from the date of the conclusion letter.  This is set in stone. If the complaint is over 6 months from the date of the conclusion letter, there are no exceptions to this!

There are however, interestingly, two other time-limits that need to be taken into account when dealing with a complaint.  This is where we deal with it initially with the Bank, and if needs be with the Financial Ombudsman: –

  1. The first is that the complaint should be submitted no later than 6 years after the transaction or problem occurred.

The problem in relation to any financial claim is that this is likely to be a fairly pointless time limit as the majority of any financial transactions are not pulled up as “flawed” for some time after the 6-year period.  Therefore, this time-limit (to some extent) is irrelevant.   There is however cover in order to protect consumers that wish to make a claim over 6 years after the transaction took place.  This protection is the 3-year rule.

  1. The 3-year rule covers any complaints made within 3 years from the period when you should have known, or became aware that you could make a complaint.

There is one draw-back to this particular rule which is that it is a grey area.  Anything in relation to Financial Institutions which causes blurry lines and greyness does cause some concern, as they can attempt to hide behind this, and encourage their regulators to hide behind this in order to protect the lender.

However, on a number of occasions when the Banks have highlighted the length of time that the customer has had to complain, we have been able to argue successfully against this and been able to win compensation for the client.

This rule is never going to succeed in every case where we deal with the Banks, as Banks will win on some cases.  However, on those cases for clients where we are unsuccessful, they are of course protected by not having to pay any fee under our “No Win No Fee” scheme, as of course if there is no success, there is no fee to pay.

Therefore, without any official time-limit in place, it is important to consider whether any Packaged Bank Account facility that you have, or have had in the past, is looked at if you have any form of grievance with its setup or continued use.