The Monetary Conduct Authority verified last month that the limitation for settlement that can be granted by the Financial Ombudsman Service (” FOS”) will be raised from â¤ 375,000 to â¤ 415,000, for problems made after 1 April 2023 associating with acts or omissions on or after 1 April 2019– a boost of over 10%.
A lower limitation of â¤ 190,000 uses to any problems made from 1 April 2023 associating with occasions that happened prior to 1 April 2019– once again a boost of over 10%, from â¤ 170,000 in 2022.
This boost has actually been made in line with CPI inflation. Yearly inflation connected boosts to FOS settlement limitations began in 2019 when the FCA reset the optimum settlement from â¤ 150,000 to â¤ 350,000. This accompanied FOS’s remit being broadened to consist of not just specific customers and micro-SMEs, however likewise SMEs with less than 50 workers and a turnover of under â¤ 6.5 m per year.
Whilst these boosts are inflation-linked, it does suggest FOS awards can have progressively substantial monetary influence and effect on companies; particularly thinking about that FOS procedures are suggested to be casual and reach what FOS thinks about is a reasonable and sensible result, which might not constantly line up with celebrations’ stringent legal rights.
The increased FOS limitations bring into sharp focus the requirement for companies to guarantee their grievance dealing with procedures are robust, to lower up until now as possible the variety of meritorious problems being described the FOS.