Where the scheme stands
As of 8 October 2026: the FCA’s page (last updated 16 September 2026) says its scheme was legally challenged and parts of it have been suspended. The case is due to be heard in December 2026 or February 2027. Until it’s decided, lenders don’t need to work out or pay compensation to people owed money under the scheme. If the scheme is upheld, the FCA expects payments to start in 2027.
Some parts of the scheme haven’t been suspended. The FCA’s page sets out the dates by which lenders should tell customers about their decisions, including for people who aren’t owed compensation. Because the position may change, check the FCA’s car finance complaints page before you act.
Who it covers
The scheme covers car and other motor vehicle finance taken out between 6 April 2007 and 1 November 2024, on hire purchase or PCP. It doesn’t cover leasing (personal contract hire). The FCA expects about 12.1 million agreements to qualify, around 37% of those eligible. An agreement may qualify where there was:
- a discretionary commission arrangement, which let the dealer or broker set your interest rate and earn more commission for a higher rate
- high commission that wasn’t properly disclosed, which the FCA defines by reference to the cost of credit and the amount borrowed
- a contractual tie between the lender and the dealer that wasn’t disclosed, with some exceptions where the link was obvious, such as a manufacturer’s own finance company
How much
The FCA says people who get compensation will receive around £830 per agreement on average, though it varies. The amount is based on an estimate of the loss, the commission paid and interest on top, and about one in three cases will be capped. Your lender works it out, not you.
What to do now
- If you think you’re affected, complain to your lender. The FCA’s page lists lenders and has template letters. It’s free.
- Keep any letters your lender sends about the scheme, and check the dates on them.
- If you get a decision and disagree, you can challenge it with the lender and then complain to the Financial Ombudsman Service, which is free. The FCA’s page explains the time limits for accepting or challenging a decision.
You don’t need a claims company
You can complain to your lender yourself, for free, and keep all of any compensation. Claims management companies and law firms may charge a share of what you get; the FCA warns this can be up to 36% including VAT. Be wary of anyone who cold-calls you about car finance claims or asks for a fee upfront.
Rechecking: this page reflects the FCA’s position on 8 October 2026. We’ll recheck it before the site launches and whenever the FCA updates its page.