FCA Motor Finance Compensation Scheme – Policy Update - If you entered into a Hire Purchase (HP) agreement for a motor vehicle after 6 April 2007, your agreement may have included a commission arrangement between the dealer or broker and the finance provider. If so, and if your agreement meets the criteria set by the Financial Conduct Authority (FCA), you may be entitled to redress. You can still make a complaint about this, but the FCA has temporarily paused lenders’ responses to motor commission complaints. Lenders are not required to respond until 31 May 2026. Read more

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28th April 2026

FCA Motor Finance Compensation Scheme – Policy Update

The FCA has published its final rules for the motor finance compensation scheme in policy statement PS26/3. It confirms that the scheme will come into force on 31 March 2026, known as the ‘Scheme effective date’. After this date, there will be a short implementation period to allow firms time to prepare:

  • Until 30 June 2026 for agreements taken out from 1 April 2014
  • Until 31 August 2026 for agreements taken out before this date

We have been preparing for the introduction of the compensation scheme and will be reviewing the policy statement in detail to ensure our approach aligns fully with the final FCA rules

We can confirm that we have never used any form of Discretionary Commission Arrangement and have never allowed the broker to influence the interest rate for any potential customer.

We can confirm that we will be contacting customers (or their representatives) and providing updates in accordance with the FCA’s expected timescales.

Claims Management Companies

The Financial Conduct Authority (FCA) has said:
“We aim to make any redress scheme easy to take part in without needing a claims management company (CMC) or law firm. Using a CMC or law firm could mean you pay up to 30% of any compensation you receive in fees.”

Under the redress scheme rules, lenders must contact all customers who may be eligible for a payment as soon as possible. Using a claims management company will not speed up this process or improve your chances of receiving redress.

If you have already instructed a claims management company to act for you, please be careful before signing up with any additional claim firms. You should always check the terms of your existing agreement first, as you may have to pay cancellation or exit fees if you end your contract after the cooling off period.

The FCA and the Solicitors Regulation Authority (SRA) have recently issued a joint warning to claims management companies about the problems caused when multiple firms represent the same customer. You can find further information here.

If you would like to make a complaint about motor finance commission, you can contact us directly, there is no need to use a claims management company.