The UK’s Financial Conduct Authority (FCA) is proposing to give motor finance firms more time to address complaints about commission disclosures.
This announcement is on the back of the Court of Appeal’s 25 October judgment in Hopcraft, Johnson and Wrench and follows a court ruling requiring lenders to tell customers about commissions paid to dealers for arranging car loans.
Many customers weren’t informed about these commissions, which may have influenced the deals they were offered.
The proposed extension ensures firms handle complaints fairly and consistently.
The FCA is consulting on 2 options for extending the time firms have to provide final responses to motor finance complaints involving a non-discretionary commission arrangement:
- Until 31 May 2025, reflecting how long it may take to hear whether the Supreme Court has granted permission to appeal. The FCA plans to set out its next steps on DCA complaints in May 2025.
- A longer extension until 4 December 2025, to align with the current rules for motor finance firms dealing with discretionary commission complaints.
This change is meant to give companies time to properly investigate and resolve cases, ensuring fair outcomes for consumers.
In principle we agree that a pause on non-DCA complaints is sensible, to allow lenders time to gather data and prepare themselves for any possible redress payments which may become due. However, we would implore the Financial Conduct Authority to engage with motor finance lenders to ensure that they are using this time wisely, by conducting the necessary checks now, rather than waiting to face a possible deluge of claims when the pause ends.
If you think you may have been mis-sold car finance, just add a few details to the Bott and Co mis sold car finance claims checker and we will locate your car finance agreements. We’ll then tell you if you can claim and how much you might receive.
More details on the FCA announcement can be found here