The Financial Conduct Authority (FCA) is overseeing the largest consumer redress exercise in UK motor finance history. Understanding how the FCA's compensation scheme works — and what you need to do before 29 July 2026 — is essential if you want to receive everything you are owed.
Background: How the FCA Investigation Started
In January 2021, the FCA banned discretionary commission arrangements (DCAs) in motor finance after finding that they created a significant conflict of interest between car dealers and their customers. Dealers were financially incentivised to charge customers as much interest as possible — and they did so without ever disclosing this to buyers.
In January 2024, the FCA announced a formal review of historic motor finance agreements to determine the scale of the harm and whether a formal redress scheme was needed. The review covers PCP and HP agreements arranged through dealers where a DCA was in place, dating back to April 2007.
The Key Dates You Need to Know
FCA Bans DCAs
The FCA bans discretionary commission arrangements in motor finance. All affected agreements must pre-date this point.
FCA Formal Review Announced
The FCA announces a formal review of historic motor finance agreements and extends the time limit for lenders to respond to complaints.
Court of Appeal Ruling
The Court of Appeal rules in Johnson v FirstRand and related cases that lenders had a fiduciary duty to disclose commissions — significantly strengthening claimants' legal position.
Supreme Court Ruling
The Supreme Court will hear the Johnson v FirstRand appeal and is expected to issue a definitive ruling on the legal framework for compensation.
FCA Complaint Registration Deadline
The deadline for consumers to register motor finance complaints. Complaints registered before this date will be processed under the FCA's formal redress scheme. Missing this date may result in losing your right to claim.
What the FCA's Redress Scheme Will Cover
Based on the FCA's published guidance and the outcome of the Court of Appeal ruling, the redress scheme is expected to cover:
- Agreements: PCP and HP finance arranged through car dealers
- Date range: April 2007 to January 2021
- Lenders: All FCA-regulated motor finance lenders who operated DCAs
- Compensation: Refund of overpaid interest plus 8% statutory interest
- Process: Lenders will be required to proactively contact affected customers once the scheme is live
Should I Wait for the FCA Scheme or Claim Now?
You do not need to wait. Registering your claim with MotorRedress now has several advantages:
- You protect your deadline rights — the 29 July 2026 deadline is hard. Claims registered before this date are protected even if the scheme is not yet live.
- We gather your evidence early — we will submit a Subject Access Request to your lender now, ensuring your records are preserved before any data retention deadlines pass.
- We monitor the scheme for you — you do not need to track FCA updates. We will handle everything and notify you when action is required.
- Faster payment when the scheme opens — claims already in progress will be processed more quickly once the formal scheme goes live.
Register Your Claim Before the Deadline
Free check in 60 seconds. No documents needed. No Win No Fee. We do everything for you.
Check My Eligibility FreeWhat Happens If You Miss the 29 July 2026 Deadline?
Missing the FCA's deadline is a serious risk. After 29 July 2026, the FCA may not require lenders to consider new complaints under the formal redress scheme. While you may still have other legal routes available (such as court action), these are more complex and expensive than the FCA scheme route.
For the full picture on the deadline, read: PCP Claim Deadline 2026 — What You Need to Know.
How MotorRedress Handles Your Claim
MotorRedress works with specialist FCA-authorised solicitors to manage your claim from start to finish. We submit formal complaints, request all relevant records, monitor progress through the FCA scheme, and escalate to the Financial Ombudsman or courts if a lender rejects a valid claim. Our fee is only charged on a successful outcome — No Win No Fee.
To understand whether your specific agreement qualifies, start with our full claims guide.