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FCA Sets Final Plans for UK Car Finance Compensation Scheme
The Financial Conduct Authority estimates 14 million mis-sold car finance deals qualify for redress with average compensation around £700 per agreement.
- On Monday, the Financial Conduct Authority will publish its final decision detailing the payout programme for 14 million motor finance agreements affected by undisclosed commissions.
- Undisclosed 'discretionary commission arrangements' between lenders and brokers allowed interest rates to be adjusted without customer negotiation; an estimated 40% of car finance deals made between April 6, 2007, and November 1, 2024, were affected.
- Payouts are expected to average about £700 per agreement, with the industry facing a total cost of £11 billion; major lenders including Barclays, Lloyds, and Close Brothers have already set aside significant funds.
- If approved, lenders have three to five months to contact customers; the FCA advises consumers to complain directly to their provider, warning that using a claims management company could result in losing over 30% of compensation.
- Legal challenges from lenders or CMC firms could still delay the process, as parties have 28 days to present a legal challenge to a tribunal before any payouts are made.
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Millions of drivers prepare for £700 compensation decision in car finance scandal update
Millions of drivers will receive a huge update on the car finance mis-selling scandal later today, which could determine how much they are owed in compensation and when this could be received.The Financial Conduct Authority (FCA) will confirm its approach to the compensation scheme after markets close later today (Monday, March 30).This follows a months-long consultation last year that looked into how a compensation scheme could be rolled out fo…
·London, United Kingdom
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Coverage Details
Total News Sources11
Leaning Left3Leaning Right1Center4Last UpdatedBias Distribution50% Center
Bias Distribution
- 50% of the sources are Center
50% Center
L 38%
C 50%
12%
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