ONE-QUARTER of those claiming compensation for mis-sold payment protection insurance (PPI) did not know companies acting for them take a fee.
In a survey of more than 2000 people, 25% admitted not knowing that claims management companies (CMCs) charge – usually 25% plus VAT.
Only about half of respondents (49%) knew using a CMC would be no more successful than making the claim themselves.
Just more than one- quarter said the main reason they would use a CMC is that they would not know how to claim themselves.
But more than half (53%) who have used a CMC to get back cash spent on a mis-sold PPI said they would be unlikely to use one again.
The biggest complaint was about value for money, with 37% of consumers unhappy.
The research was carried out by MoneySavingExpert.com and Which? as it launches a campaign highlighting how simple it is to claim. Consumer groups will hold a PPI summit with banks and credit card firms today to "restore trust" in the reclaiming process.
MoneySavingExpert.com's Martin Lewis said: "Sadly PPI has become a cash bonanza for unscrupulous claims companies, who, through a series of lies and misdirection, are persuading people they are the only option for getting their PPI money back. This is a billion pound-plus industry – it's too big to be left alone."
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