The FCA's pause on motor finance complaints ends 31 May 2026. PS26/3 covers PCP, HP and conditional sale 2007-2024. Here is how to claim free of charge before the 30 June and 31 August deadlines.
This article is informational. CDE does not act as a claims management company and earns no commission on any redress payment.
What changes on 31 May 2026 for UK car finance customers
From 31 May 2026, the FCA lifts the pause it placed on lenders handling discretionary commission and undisclosed commission complaints in motor finance. Lenders must again respond to complaints within the regulator’s usual statutory timeframes (typically eight weeks). The pause was originally extended while the FCA built a sector-wide redress framework, published as PS26/3 on 30 March 2026. Leasing complaints were never part of the pause extension; firms had to start responding to those by 5 December 2025 under standard rules. Records of relevant agreements must be retained until 11 April 2031, so even if you lost paperwork, the lender still holds the file.
Who qualifies under PS26/3 and the FCA motor finance redress scheme
Eligibility is broad. The scheme covers motor finance agreements (PCP, HP, conditional sale and similar) entered into between 6 April 2007 and 1 November 2024 where the lender or dealer failed to disclose the existence or scale of commission, or used a discretionary commission arrangement that pushed up the interest rate. The FCA splits the implementation timeline by agreement date: loans taken out from 1 April 2014 fall under the 30 June 2026 cut-off, while earlier deals run until 31 August 2026. Two important details: lease agreements (PCH) sit outside the redress framework, and a complaint already raised before the pause does not need re-filing. The FCA expects roughly £7.5 billion to flow back to consumers across the life of the scheme, with most settlements in 2026 and the bulk closed by the end of 2027. For a refresher on how the wider scheme survived its May 2026 legal challenge, see our explainer on the FCA motor finance redress scheme.
How to claim your share of the £7.5 billion (step by step)
The process is deliberately free. Do not pay a claims management company a 24%-plus cut for something the FCA designed to be self-service. Here is the sequence we would follow:
- Find your agreement. Dig out your V5C log book if you still have the vehicle, plus the original finance contract or HP/PCP paperwork. The lender’s name, the agreement number and the start date are the three details that unlock everything else.
- Identify the lender, not the dealer. The complaint goes to the finance company on the contract (Black Horse, Santander Consumer, MotoNovo, Close Brothers, BMW Financial Services UK, VWFS, Stellantis Financial Services and so on), not the dealership that sold you the car.
- Write to the lender. A short letter or web form referring to “an undisclosed commission complaint under the FCA motor finance redress scheme” is enough. Quote your agreement number, ask the firm to confirm whether the agreement was on a discretionary commission model, and ask for the commission amount.
- Wait up to eight weeks. Post 31 May 2026, the lender has the standard regulatory clock to respond. If you get a “final response” letter you disagree with, you have six months to escalate to the Financial Ombudsman Service. The Ombudsman service is also free.
- Do not sign any cash-now offer from a claims management firm. The FCA’s redress payments come from the lender, not the CMC. A 30% deduction on a £4,000 payout is £1,200 you simply do not need to give away.
What an average FCA motor finance complaints payout looks like
The FCA has not published a per-customer headline figure, deliberately, because compensation is tied to the original interest paid and the size of the undisclosed commission. The regulator’s Technical Annex 1 to PS26/3 sets out the calculation: lenders must work out the interest the customer was charged at the actual rate, then re-compute it at the rate the customer would have been offered without the discretionary commission inflation, with the difference (plus interest) returned. Real-world payouts on discretionary commission cases through the Financial Ombudsman service have generally landed in the £1,000 to £4,000 range, with longer or larger deals running higher. Treat anything specific anyone quotes you as a guess until your lender’s calculation arrives.
This scheme will put £7.5 billion back in people’s pockets while providing firms with certainty and finality to support the long-term availability of competitively priced motor finance.
Financial Conduct Authority, press release on the motor finance redress scheme.
Common mistakes that delay or kill a motor finance complaint
Two patterns kill claims that should otherwise pay out. First, complaining to the broker or dealership instead of the lender of record: that letter goes nowhere, because the lender is the regulated firm and the only party that holds the commission data. Second, accepting a “without prejudice” goodwill offer in the early days of the scheme; some lenders are settling cheaply pre-calculation to clear backlog. Read any offer carefully and do not sign away your right to escalate to the Ombudsman. If your circumstances are complex (multiple agreements with the same lender, agreements voluntarily terminated under VT, agreements that ran into a CCJ), the MoneyHelper guidance on car finance complaints is the safest free starting point. For new car-finance shoppers worried about repeating the mistake, our first-time car buyer financing checklist walks through what to ask the dealer up front.
If you already complained: what to do during the eight-week window
If you filed before the pause, do nothing yet. The lender’s clock resets on 31 May 2026 and you should see a substantive response within eight weeks of that date. Keep your reference number and a copy of every email; if the lender misses the deadline or sends a calculation that ignores undisclosed commission, escalate directly to the Financial Ombudsman Service. Customers caught in the unhelpful “we are awaiting FCA guidance” loop pre-pause can quote PS26/3 in their follow-up, which removes that excuse. Lenders also cannot offer you less than the formula in Technical Annex 1; if they try, that is a complaint about the complaint, and the Ombudsman has form on it.
What this means for buying car finance in 2026
The scheme has already changed dealer behaviour. Most franchised showrooms now disclose commission upfront and offer flat-rate finance rather than discretionary. If you are signing a new PCP or HP today, ask the salesperson for the exact APR, the commission paid to the dealer and whether the rate is flat or discretionary; ask in writing if you can. Independent brokers and used-car forecourts can still vary on this, so the new rules raise the bar for what counts as fair. The wider context, including how dealer markups are quietly returning even on transparent finance, is in our analysis on dealer markups in 2026.
Our take
The FCA motor finance complaints pause lifting on 31 May 2026 is not the headline; the eight-week clock starting that day is. If you bought a car on PCP or HP between 2007 and 2024 and were never told a commission was paid, this is the moment to write a one-paragraph letter to your lender and start the meter. The legal challenge filed on 1 May 2026 may eventually trim the scheme at the edges, but the FCA has signalled it will defend it robustly, and lenders have been preparing payouts on a precautionary basis. Our position: do it yourself, do it now, and do not pay a claims management firm 24 to 36 per cent of your money for a complaint form. The PS26/3 framework is designed to work without one.
Do I need a claims management company to make an FCA motor finance complaint?
Which lenders are covered by the FCA motor finance redress scheme?
What is the deadline to complain under PS26/3?
Are PCH lease agreements covered by the FCA pause and redress scheme?
How much can I expect to receive from a motor finance complaint?
Related reading on CDE
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Use this as the final check before paying a deposit, signing finance paperwork or relying on a headline monthly figure.
