FCA Unveils Final Car Finance Mis-Selling Redress Plans

The Financial Conduct Authority will unveil its final plans on Monday for a compensation scheme addressing the mis-selling of car finance agreements to millions of UK drivers, potentially marking the largest consumer redress program in the country's financial history. The announcement, scheduled after markets close on March 30, 2026, follows a year-long consultation and targets agreements from April 6, 2007, to November 1, 2024, where lenders and dealers imposed unfair charges through hidden commissions.

The scandal arose from practices where finance providers added discretionary commission arrangements to loan deals, inflating interest rates to boost dealer payouts without customers' knowledge. Although the FCA banned such arrangements in January 2021, an investigation revealed widespread issues affecting an estimated 14 million agreements, representing 44 percent of all car finance deals during the period. Eligible consumers may have been mis-sold if their contracts included undisclosed high commissions, excessive rates, or ties not properly explained.

Under the scheme, affected drivers could receive an average of 700 pounds per agreement, though amounts will vary based on...