REGULATORY · COMPETITIVE · UK
UK FCA motor finance mis-selling redress scheme timeline
Change
Britain’s Financial Conduct Authority plans to set out final rules for a motor finance redress scheme in late March and, if the scheme is approved, give lenders three to five months to pay compensation.
Why Now
Final rules for a redress scheme are planned for late March. If the scheme is given the green light, lenders would be allowed three to five months to make compensation payments. The FCA stated that, even with an implementation period, streamlining the process means millions of people would receive compensation in 2026. The FCA’s motor finance review found many firms broke its rules and did not properly tell customers about discretionary commission arrangements.
Impact
- • Final rules are scheduled for late March for a motor finance redress scheme.
- • If approved, lenders would have three to five months to make compensation payments.
- • The redress is tied to failures to disclose discretionary commission arrangements identified in the FCA’s review.
Who Recalculates
- • Motor finance lenders
- • Auto finance intermediaries/brokers
- • Motor finance customers/drivers
Source
Topics
Law & Public Safety Regulatory Actions Compliance Finance & Banking Financial Services