Car finance claims

If you've used motor finance to buy a car, motorbike or van, it's very likely that the lender paid the broker (the person that arranges your loan, usually your car dealer) commission for arranging the loan.

We've found that many firms broke our rules and didn't properly tell customers about commission arrangements.

On 1 August 2025, the Supreme Court ruled that in many cases commission payments could be legal. But in certain circumstances the failure to properly disclose commission arrangements could be unfair and therefore unlawful.

Compensation scheme

We’ll consult on setting up a compensation scheme for eligible car finance customers.

A scheme would get compensation to people who’ve lost out. It’s likely to be simpler than making a complaint and you won’t need to use a claims management company.

If the scheme goes ahead, we’ll set rules for how firms assess claims and calculate any compensation owed. We will also put checks in place to make sure firms are following our rules.  

We’ll propose that the scheme covers discretionary commission arrangements (DCAs) – where the broker could adjust the interest rate offered to a customer – if they were not properly disclosed.

We'll also consult on which non-discretionary commission arrangements should be included.

How much you could get

If you're owed money, the amount you get will depend on many factors. But based on our work so far, most people would probably get less than £950 per agreement.  

This would include interest, which is normally paid on top of compensation. This should be fair and proportionate. We're likely to propose an interest rate that would work out around 3% per year.

What we’ll do next

Before we launch any scheme, we’ll get views on how it will work. For example, whether you would need to opt in or opt out of the scheme.

• Under an opt-in compensation scheme, you would have to confirm to your provider by a certain date that you wished to be included.
• Under an opt-out compensation scheme, you would automatically be included unless you opt out.

Whichever approach we propose, we anticipate requiring firms as far as possible to make customers aware they may be eligible and what they may need to do.

We plan to publish a consultation in October 2025 setting out how we think the compensation scheme should work. We'll then review any feedback before deciding. If the scheme goes ahead, the first payments should be made in 2026.

‍