If you took out car finance between 2007 and 2024, you may be owed money due to unfair discretionary commission practices. The Finance & Leasing Association (FLA) has urged the Financial Conduct Authority (FCA) to adopt a fairer, targeted consumer redress scheme—one that compensates people who actually suffered loss while protecting access to affordable credit.
Featured snippet (quick take):
The FCA’s proposed motor finance redress scheme aims to compensate consumers affected by undisclosed commission models used on car finance. The FLA supports redress but wants tighter targeting and workable timelines. Consumers could start receiving compensation in 2026—so prepare your claim now with National Claims.
What’s happening with the FCA’s motor finance redress?
The FCA consulted on a market-wide FCA motor finance redress scheme (Section 404 FSMA) addressing cases where brokers could adjust interest rates (the “discretionary commission” model) and did not adequately disclose this, potentially causing unfair relationships. The consultation closed in December 2025; final rules are expected in early 2026, with compensation flowing later in 2026.
Meanwhile, the FCA confirmed the pause on handling many motor finance complaints will lift on 31 May 2026, aligning with implementation of any scheme. That means consumers should get their paperwork in order now.
Industry estimates and reporting indicate the potential scale runs to the billions, underlining how widespread the issue may be.
What is the FLA asking the FCA to change?
The FLA—representing many UK motor finance providers—supports a credible, consumer-focused scheme but has pressed for a fairer approach that:
- Compensates customers who actually suffered loss.
- Avoids paying redress where no unfair relationship occurred.
- Protects longer-term access to credit and keeps the scheme workable for firms to deliver at scale.
In addition, the FLA has engaged with the Financial Ombudsman Service and the FCA on modernising redress processes to ensure decisions reflect the law and rules that applied at the time.
How National Claims helps you claim compensation (no win, no fee)
At National Claims, we streamline eligibility checks, evidence gathering, and submission so you can pursue motor finance mis-selling compensation with confidence.
Our simple 4-step pathway
- Free eligibility review – We confirm whether your agreement falls within the likely scope of FCA motor finance redress.
- Evidence building – We help obtain agreements, commission disclosures, and payment histories.
- Submission & management – We present your claim in line with the FCA’s final rules and timelines.
- Settlement & follow-through – We chase outcomes and explain any deductions clearly.
Eligibility checklist (fast self-assessment)
You likely qualify to explore a claim if:
- You took out PCP/HP finance between 2007–2024.
- Your APR felt higher than expected or you weren’t told how commission affected your interest rate.
- You refinanced early, paid large exit fees, or were pressured to accept a rate “today only”.
- You have limited paperwork but can recall the dealer/broker and approximate dates (we can help reconstruct the rest).
Tip: Keep bank statements, emails, texts, and any sales brochures. These can demonstrate how a discretionary commission may have inflated your rate.
Likely process and timelines
The FCA has flagged a policy statement and final rules in early 2026, with consumers starting to receive compensation before the end of 2026. The complaint-handling pause lifts 31 May 2026, aligning the operational timetable. That means starting your claim preparation now puts you near the front when firms must decide cases again.
How much could you receive?
Every case is different, but redress typically aims to return you to the position you’d have been in without the unfair practice. That may include:
- Overpaid interest due to undisclosed commission structures.
- Associated charges plus appropriate statutory interest where applicable.
(Exact calculations will depend on the FCA motor finance redress rules and your agreement.)
Example: indicative compensation components
| Component | What it covers | Notes |
|---|---|---|
| Interest difference | Extra interest you paid vs. a fair rate | Based on agreement, APR, term |
| Fees/charges | Excess or unfair fees linked to the arrangement | Depends on documentation |
| Statutory interest | Compensates for time value of money | Subject to FCA rules and law |
Research and regulatory analysis suggest the industry-wide cost could run to the billions, underscoring the potential significance of individual claims.
If your finance issue arose from a road collision too
Some readers also suffered personal injuries in a related road traffic incident. For injury valuation, courts and practitioners reference the Judicial College Guidelines (JCG). Below is a simplified snapshot:
| Injury type (JCG) | Typical guideline range* |
|---|---|
| Minor whiplash/soft-tissue (recovery ≤24 months) | up to several thousand pounds |
| Moderate back injury (longer-lasting symptoms) | tens of thousands of pounds |
| Serious brain/spinal injury | six-figure to seven-figure awards |
*Ranges depend on medical evidence, impact on work, and long-term prognosis. (Source: Judicial College Guidelines, latest edition.)
If this applies to you, our team can coordinate both your FCA motor finance redress and a personal injury pathway, ensuring nothing is missed.
Documents that help your claim
- Finance agreement (PCP/HP), APR and payment schedule
- Any email or letter mentioning commission or “broker fees”
- Dealer/broker name, showroom location, and sales adviser details
- Bank statements showing deposit, monthly payments, and any settlement
- Notes of conversations, especially if you queried the interest rate
Can’t find everything? Don’t worry —> National Claims can help request data from lenders and dealers as part of your FCA motor finance redress file.
Frequently Asked Questions
1. Is this the same as PPI?
No. This centres on discretionary commission and any failure to disclose how it affected the interest rate you paid. The remedy is separate but similarly aims to correct unfair consumer outcomes.
2. Do I need to wait until 31 May 2026?
You don’t need to wait to prepare. The FCA has tied the lifting of the complaint pause to 31 May 2026, so being ready helps you move first when decisions resume.
3. What if my agreement was a lease?
The FCA has signalled differences in approach for pure leasing. We’ll check your product type and advise the correct route.
4. Will using National Claims reduce my payout?
We work to maximise what you receive and explain any fees upfront. “Customers pay up to 25% (incl. VAT) of the amount recovered towards solicitor costs and if you cancel outside your cooling off period, you may be charged a fee.”
Why act now?
- Evidence is freshest now; recovering old documents later can be slow.
- The FLA has asked the FCA to focus on targeted, workable delivery—so complete, accurate claims are more likely to move quickly.
- Regulators expect a structured roll-out: be ready as soon as final rules land.
Don’t wait while your claim window closes. Speak with National Claims today. We’ll connect you with experienced solicitors who understand your case and fight for the maximum compensation you deserve.
About National Claims
This article was written by the National Claims content team. Our specialists have years of experience helping people across the UK with personal injury, road traffic accident, and housing disrepair claims. We work alongside regulated solicitors to ensure our information is accurate, up-to-date, and genuinely useful for anyone seeking to understand their rights after an accident.
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