Car finance redress
The car finance redress timeline is the dated, sourced chronology of the motor finance commission scandal and the FCA redress scheme. Use it as one sequence you can cite when you check your own claim, catch up on the news or test a claims firm's pitch.
Worked example
Lender's target APR 7%. Broker sets your APR at 9%. The extra 2% of interest across the term is collected from you and shared with the broker as commission. You were quoted "9% APR", but nobody told you 7% was available, or that the broker's pay rose with your APR.
Redress estimate
Any figures here are an estimate, not a promise, and nothing on this page is financial or legal advice. You can claim free yourself — you don't need a claims firm.
The car finance redress timeline runs from the 2007 start of the affected window to a legal challenge that has put parts of the FCA scheme on hold, with payouts expected in 2027 at the earliest, if the scheme is upheld and the judgment is not appealed. PS26/3 set an implementation period ending on 30 June 2026 for agreements from 2014 onward and on 31 August 2026 for older ones, but the Upper Tribunal suspended parts of the scheme with effect from 29 June 2026, and the challenge is due to be heard from 16 February to 3 March 2027. If no firm contacts you, the consumer deadline is 31 August 2027 under the scheme rules as made, which may change after the legal challenge. The sourced chronology behind those dates runs from the FCA's ban on discretionary commission (28 January 2021) through the Supreme Court ruling (1 August 2025) to the FCA's redress scheme (PS26/3, 30 March 2026) and its partial suspension. The table below lists every milestone in order, and the steps show how to match your own agreement to it. The rest of the page explains each phase and your free rights.
The FCA expects roughly ~£7.5bn of redress across about 12.1 million agreements, averaging around ~£829 per agreement. Any figure you see is an estimate, not a promise. Nobody is guaranteed a payout, and the amount depends on your own agreement. For your own number, try the compensation estimator.
The car finance redress timeline
The car finance redress timeline is the dated, sourced chronology of the motor finance commission scandal and the FCA redress scheme. Use it as one sequence you can cite when you check your own claim, catch up on the news or test a claims firm's pitch.
Every entry below carries a date and a source: the FCA for regulatory action and the scheme, and the Supreme Court of the United Kingdom for the 2025 ruling. Where a date is provisional (the start of payouts, say, or any shift from the legal challenge), we say so plainly.
For the explanation behind each milestone rather than the bare dates, read the scandal explained and the FCA scheme. For the live, developing picture, read claims news.
Phase 1: The commission era (6 April 2007 – 28 January 2021)
For nearly fourteen years, brokers arranging car finance could earn more commission by setting a higher interest rate, through the discretionary commission arrangement (DCA) at the centre of this scandal. The affected window opens on 6 April 2007.
Under a DCA, the lender set a target rate and a higher ceiling. The broker could push your rate up towards that ceiling, and the difference was paid to them as commission. So the person finding you finance was rewarded for charging you more, usually without telling you. The FCA later concluded this conflict could make the lending relationship unfair.
The earliest agreement date the scheme covers is 6 April 2007. If your finance started on or after that date and was arranged through a commission-paid dealer or broker, that's the first milestone to check.
How a DCA worked
Phase 2: The ban and the build-up (28 January 2021 – 2024)
On 28 January 2021 the FCA banned new discretionary commission arrangements. No DCA should appear on a deal dated after that, though the wider scheme window runs to 1 November 2024 to catch high-commission arrangements and contractual ties that carried on.
The ban stopped the clearest conflict, but it didn't settle deals already written under a DCA. From 11 January 2024 the FCA paused motor finance commission complaint handling while it worked out a scheme-wide approach. This headed off a flood of individual complaints at the Financial Ombudsman before the rules were settled. That pause expired on 31 May 2026, two months after the scheme was made on 30 March 2026.
The latest agreement start date in scope is 1 November 2024. A post-ban deal can still qualify if an undisclosed high-commission arrangement (commission at least 39% of the total cost of credit and at least 10% of the loan) or a contractual tie applied.
Phase 3: The Supreme Court ruling (1 August 2025)
On 1 August 2025 the UK Supreme Court ruled that undisclosed motor finance commission can make the lending relationship unfair under section 140A of the Consumer Credit Act 1974. It didn't order automatic payouts. It set the legal framework the FCA then turned into a scheme.
The lead case did not turn on secrecy alone. The court said the mere fact that commission was not disclosed, or only partly disclosed, "will not necessarily suffice" to make the relationship unfair under section 140A; it is one factor in the overall balance. Mr Johnson won because the undisclosed commission was large (55% of the total charge for credit) and his documents hid a commercial tie between the lender and the dealer while giving the false impression that the dealer was choosing from a panel of lenders. Section 140B sets out the remedies, including reducing what's owed or ordering repayment.
The judgment is why an industry-wide scheme became lawful, rather than leaving each borrower to fight it out in court. Read it in full on the Supreme Court ruling page. Source: Supreme Court of the United Kingdom (supremecourt.uk).
What the court did NOT do
Phase 4: The FCA redress scheme (30 March 2026)
On 30 March 2026 the FCA finalised the motor finance consumer redress scheme in Policy Statement PS26/3. It covers agreements from 6 April 2007 to 1 November 2024, and the FCA estimated it would deliver about ~£7.5bn of redress across roughly 12.1 million agreements.
The scheme applies the same three-part test across every firm: an undisclosed DCA, an undisclosed high-commission arrangement, or an undisclosed contractual tie. 0% and minimal-commission deals are excluded. Redress is the extra interest you paid because of the commission, plus interest on top, with a cap on roughly one in three qualifying agreements.
On 1 May 2026 the FCA confirmed the scheme had been legally challenged, and said it would defend it "robustly as lawful." The challenge was brought by CA Auto Finance, Mercedes-Benz Financial Services, Volkswagen Financial Services and Consumer Voice. Its grounds include the FCA's power to make the rules and the scheme's presumptions of unfairness and loss, and Consumer Voice argues the scheme is too favourable to lenders. Source: FCA statements (1 May, 8 May and 13 October 2026).
Tightened eligibility
Phase 5: The suspension and when payouts could start (2026 to 2027)
PS26/3 set an implementation period ending on 30 June 2026 for agreements from 1 April 2014 onward, and on 31 August 2026 for earlier agreements, but parts of the scheme were suspended with effect from 29 June 2026. Until the legal process ends, lenders do not need to calculate or pay compensation, and payouts are expected in 2027 at the earliest, if the scheme is upheld and the judgment is not appealed.
The two dates differ because the legal framework changed on 1 April 2014. Newer agreements sit under a regime the FCA considers straightforward to assess; earlier ones need extra checking, which is why their period ran about two months longer. Your lender must still tell you if you are not owed money by 18 November 2026 for agreements from 1 April 2014 where you complained by 30 June 2026, or by 18 January 2027 for earlier agreements where you complained by 31 August 2026, subject to limited exceptions. The consumer deadline, the last date to complain if no firm contacts you, is 31 August 2027 under the scheme rules as made, which may change after the legal challenge.
Treat any payout date as provisional. The challenge is due to be heard from 16 February to 3 March 2027, with a judgment expected in the following months; if the scheme or parts of it are quashed, the FCA may consult on a revised scheme or tell lenders to handle complaints through the usual complaints process. The FCA is defending the scheme, and free DIY complaints continue regardless. Any figure you see is an estimate, not a promise. Nobody is guaranteed a payout, and the amount depends on your own agreement.
The full dated timeline
Every milestone, in order, dated and sourced. This is the table to cite.
Read the timeline in order and you can see that nothing has been cancelled, though payouts are on hold. The 2025 ruling set the legal test, the March 2026 scheme turned it into a process, and the challenge from May 2026 led to the partial suspension from June 2026. The hearing from 16 February to 3 March 2027 will decide whether the scheme stands as made.
| Date | Milestone | Source |
|---|---|---|
| 6 April 2007 | Start of the affected-agreement window (earliest in-scope deals) | FCA, PS26/3 |
| 6 Apr 2007 to 1 Nov 2024 | Affected window: agreements where commission was payable to a broker | FCA, PS26/3 |
| 28 January 2021 | FCA bans new discretionary commission arrangements (DCAs) | FCA |
| 11 January 2024 | FCA pauses motor finance commission complaint handling while designing a scheme | FCA |
| 1 August 2025 | Supreme Court rules undisclosed commission can make the relationship unfair (s140A, CCA 1974) | Supreme Court (supremecourt.uk) |
| 30 March 2026 | FCA finalises the motor finance consumer redress scheme (PS26/3) | FCA, PS26/3 |
| 1 May 2026 | Scheme legally challenged; FCA says it will defend it as lawful | FCA statement |
| 31 May 2026 | Complaint-handling pause expires | FCA statement |
| 29 June 2026 | Upper Tribunal suspends parts of the scheme (announced by the FCA on 2 July 2026); lenders need not calculate or pay compensation until the legal process ends | FCA statement (2 July 2026) |
| 18 Nov 2026 and 18 Jan 2027 | Lenders must tell you if you are not owed money (complaints by 30 June 2026 for agreements from 1 Apr 2014; by 31 August 2026 for earlier ones), subject to limited exceptions | FCA statement (2 July 2026) |
| 16 Feb to 3 Mar 2027 | Upper Tribunal hearing of the legal challenge; if the scheme is upheld and the judgment is not appealed, payouts are expected to begin in 2027 | FCA statements (2 July and 26 October 2026) |
| 31 August 2027 | Consumer deadline to complain if no firm contacts you, under the scheme rules as made (may change after the legal challenge) | FCA, PS26/3 |
Other rights that run alongside redress
Two free, statutory rights sit alongside the redress scheme and cost nothing to use. They're separate from commission redress but worth knowing about.
These rights don't depend on the redress scheme and aren't affected by its legal challenge. See voluntary termination for the 50% rule in full.
- Voluntary Termination (CCA 1974, sections 99 and 100): you can hand back a PCP or HP car once you've paid 50% of the total amount payable, but not a PCH (leasing) car. It's free and you can do it yourself.
- Early settlement: under the Consumer Credit (Early Settlement) Regulations 2004 you're entitled to a statutory interest rebate when you pay off early; the lender may add up to about one month's interest.
- Free DIY complaint: complain to your lender, then escalate to the Financial Ombudsman Service. You don't need a claims firm.
How to use this timeline
Match your own agreement to the dates, then act for free. The timeline tells you if you're in scope and what comes next. It doesn't promise you any payout.
If your start date or route puts you outside the window, you're generally out of scope, so see am I eligible. Any figure you see is an estimate, not a promise. Nobody is guaranteed a payout, and the amount depends on your own agreement.
- Check your agreement start date falls between 6 April 2007 and 1 November 2024.
- Confirm it was arranged through a commission-paid dealer or broker (not a direct bank loan).
- Note whether a DCA, high-commission arrangement or contractual tie may have applied and was not disclosed.
- Estimate your position with the free mis-sold car finance estimate, then complain to your lender using the free letter template.
Cite it freely
Estimate and claim
Get a rough idea now, for free, then claim yourself. No claims firm needed at any stage.
Try the compensation estimator, then follow how to claim. Claiming is free and you can do it yourself: complain to your lender first, then escalate to the Financial Ombudsman Service. You do not need a claims-management company taking a cut. This page is news and explain, not financial advice or a recommendation to claim. We are independent — we sell no finance, take no commission and run no claims.
Frequently asked
When did the car finance scandal start?
When were discretionary commission arrangements banned?
When was the Supreme Court motor finance ruling?
When was the FCA redress scheme confirmed?
When will the scheme start paying out?
Has the scheme been challenged?
What is the consumer deadline for car finance claims?
Is this timeline financial advice?
Sources
We cite regulators and official UK sources only.
- Financial Conduct Authority — motor finance redress schemefca.org.uk
- UK Supreme Courtsupremecourt.uk
- Consumer Credit Act 1974legislation.gov.uk
- Financial Ombudsman Servicefinancial-ombudsman.org.uk
Work out your next step
Independent calculators — pick the one that fits your situation.