FCA extends car finance compensation plan as lenders push back
- paulrobinson764
- Nov 6, 2025
- 2 min read
FCA extends car finance compensation plan as lenders push back
The Financial Conduct Authority (FCA) has launched a consultation on an industry-wide compensation scheme for motor-finance customers who may have been mis-sold deals between 6 April 2007 and 1 November 2024.
Key points:
The issue centres on hidden or undisclosed commissions (including discretionary commission arrangements) that may have inflated costs for borrowers.
Around 14.2 million agreements — roughly 44% of all motor-finance deals since 2007 — could be eligible for redress.
Average compensation per agreement could be ~£700, depending on the case.
The consultation has been extended to 12 December 2025, with final rules expected in early 2026.
Lenders face significant financial and reputational risks, with new provisions, audits and disclosures expected in the coming months.
How Watchdog Services Can Help
At Watchdog Services, we specialise in monitoring Companies House and FCA register data to help clients stay ahead of regulatory change.
✅ Early risk identification – we flag firms with motor-finance permissions or new provisions related to redress.
✅ Permissions & governance monitoring – we track regulatory permission changes and senior management updates.
✅ Corporate transparency – we analyse filings for emerging financial stress or restructuring.
✅ Due-diligence support – we provide data for investors and advisers assessing exposure.
✅ Trend detection – we highlight patterns across consumer credit and financial services where regulatory pressure is increasing.
The car-finance investigation is a reminder that regulatory risk can surface years after the transaction — and timely data monitoring matters more than ever.