Use the PPI calculators below to check how much you could be owed in PPI compensation, please remember the figures presented are estimated.

PPI Refund Calculations

The way a PPI refund is calculated can be extremely complex at the best of times. I'll break it down as best as possible to try and explain.

It starts off with the amount borrowed. This can be anything from the amount owed on a credit card each month, to the amount taken on a loan or mortgage etc.

There are various ways that the calculations are worked, depending on circumstances at the time of sale, for instance some banks "front loaded" the PPI onto a loan, so the full cost of PPI was added to the loan in the beginning. An example would be:

  • You borrow £10,000 from the bank for 10 years
  • The cost of the PPI policy over the period of 10 years is £2,000
  • The bank decide to "front load" the PPI policy, therefore making the loan £12,000 (before interest is added)

This is what a "front loaded" loan would be if PPI were to be added.

The calculation would then be worked out by taking the amount of the PPI policy, and applying the interest rate. Then break that down into what the monthly cost of the PPI would be, including the added interest. After this has been worked out, an additional 8% statutory interest is applied for each day since that particular payment was made (for each day from the first payment, through to the current day. Anything pre-April 1993 is 15% p/a). The calculations are then added together, so the Cost of the PPI + interest + statutory interest = compensation amount due.

If you wish to calculate whether or not you have received an offer of compensation that is correct, this would be the way to do it. The letter you received should have a breakdown of each part of the compensation in order to make this a bit easier. On the other hand, if you are/have used My Claim Solved, then don't worry! We have a specialist team who thoroughly check through each and every offer, to ensure the maximum amount of compensation is awarded for each offer we receive. We know how untrustworthy banks can be. After all, that's why you're here!

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