Victims of the payment protection insurance (PPI) mis-selling scandal could potentially have been under-compensated by an estimated £1 billion, a BBC investigation has found.
Customers who may possibly have been affected had PPI on credit cards issued by Lloyds Banking Group, Barclays, MBNA and Capital One, Radio 4's You and Yours programme says. All these banks claim to make every effort to pay the correct amount of compensation (see our Reclaim Credit Card PPI guide for help on reclaiming).
The issue has arisen because providers paid out the premiums and interest on mis-sold policies, but their calculations may have failed to take into account any charges or fees incurred by users tipped over their borrowing limit as a result of paying PPI.
The BBC says one complainant, Mark Pascoe reclaimed £5,800 from MBNA. However, the report alleges MBNA's calculations didn't account for the £600 Pascoe paid in fees and charges since taking his card out in 1997.
If this figure was included in the original calculation, Pascoe would have received £13,000 in compensation, a shortfall he calls "almost robbery".
How do I know if my PPI offer is correct?
The simplest way to check if your PPI offer is correct is to contact your provider to check. If you're unhappy with its response, you can take your complaint to the Financial Ombudsman Service. See our PPI help leaflet for more info on how to check your redress offer.
How many complaints have there been?
MoneySavingExpert.com contacted the indepdendent complaints arbitrator, the Financial Ombudsman Service. It says there have been a "small number" of complaints about this specific issue.
We also spoke to the Financial Conduct Authority (FCA). It says anyone who incurred fees or charges as a result of paying for PPI and going over their borrowing limit should have them refunded, plus interest.
The regulator adds that it's keeping a close eye on how firms continue to handle complaints and will intervene if necessary.
Get Our Free Money Tips Email!
How do I reclaim PPI in the first place?
If you've ever had a loan or credit card, check now to see if you were mis-sold PPI. A common complaint is that consumers are told they must buy PPI in order to be accepted for the loan. This is mis-selling.
You can also reclaim PPI for free by yourself. You don't need to pay a company 30% of your reclaim to do it for you. See our Reclaim PPI for FREE and Reclaim Credit Card PPI Free guides for templates letters and extensive FAQs.
What do the banks say?
All the banks named in the BBC's story told You and Yours they make every effort to pay customers the right amount on their PPI claims.
Here's what each bank told MoneySavingExpert.com.
Lloyds: "When a customer receives redress on their PPI policy we send them a letter detailing the calculation. The customer will be asked to inform us if they have suffered any consequential or additional loss as a result of the sale of their PPI policy. Upon receipt of additional information we will investigate and refund where appropriate.
"We are committed to doing the right thing for our customers and this includes ensuring that each PPI case we receive is investigated on an individual basis."
Barclays: "We work to provide the best outcomes for our customers and review each case on its individual merit, in line with industry redress methodology laid down by the FCA and align this to guidance from the Financial Ombudsman Service.
"In the case of late and over-limit fees, where it is possible to identify that fees have been triggered by the customer taking PPI, we have already repaid them and in recognition that we may not have been able to identify all fees, we have paid additional interest to more than mitigate any customer detriment."
MBNA: "Fees of this nature are required to be refunded when they are 'caused' by the mis-sale of PPI. Not all credit card fees and charges are the same between issuers and there are aspects of MBNA's fees and charges and the way they are charged (or not charged) which are highly relevant to whether MBNA might be liable to refund them.
"Our system operates so that the cost of PPI is only applied after the customer has gone over limit and after the over limit fee has been applied. As such, PPI could never cause our customers to be over limit or cause the fee to be applied."
Capital One: Capital One hasn't responded to our request for a comment.
Additional reporting by the Press Association.