What is the FCA Motor Finance Redress Scheme?

What it is

The Financial Conduct Authority (FCA) introduced the final motor finance redress scheme rules in March 2026, after a multi-year market review and a string of court rulings on motor finance commission — most notably the UK Supreme Court’s 2025 decision in Johnson v FirstRand. The scheme is the FCA’s mechanism for compensating consumers harmed by undisclosed or unfair commission practices on car finance, without each driver having to bring their own complaint from scratch.

Three categories of agreement fall inside the scheme. The first is Discretionary Commission Arrangements (DCAs), where the dealer or broker could earn more by pushing your interest rate higher. The second is certain “high commission” arrangements. The third is certain tied agreements, where the broker was contractually limited to a single lender. The scheme reference period runs from 6 April 2007 to 1 November 2024, with DCAs tied to the pre-ban period before 28 January 2021. The FCA’s published estimates put total redress at approximately £7.5 billion across roughly 12.1 million eligible agreements, with an estimated average payout of approximately £830 per agreement at projected uptake. Lenders themselves run the assessments under FCA rules, and the Financial Ombudsman Service (FOS) handles unresolved disputes. As of May 2026, parts of the scheme remain subject to legal challenge.

Why it matters for your claim

If your PCP or HP agreement was signed between 6 April 2007 and 1 November 2024, the scheme may apply depending on the commission arrangement and what was disclosed. You do not need a Claims Management Company to take part — lenders are expected to contact eligible customers, and you can approach your lender yourself at no cost. Total Claim’s role, for drivers who choose to use a CMC, is to manage the lender correspondence, check eligibility across multiple agreements and funders, and escalate to FOS where the lender’s assessment is disputed. The scheme also does not extinguish your right to bring an individual unfair-relationship complaint under section 140A of the Consumer Credit Act 1974 if the scheme outcome is unsatisfactory.