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Financial Conduct Authority Partially Suspends Car Finance Redress Scheme
The Financial Conduct Authority announced a partial suspension of its car finance redress scheme after four commercial parties filed legal challenges. Hearings at the Upper Tribunal are set for December 2026 and February 2027.
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The Financial Conduct Authority announced a partial suspension of its car finance redress scheme. GB News reported that four commercial parties filed legal challenges against the scheme: Consumer Voice, represented by Courmacs Legal, Volkswagen Financial Services, Mercedes-Benz Financial Services, and Crédit Agricole Auto Finance.
The Upper Tribunal will hear the challenges in December 2026 and February 2027.
1 million car finance agreements remain eligible for compensation under the scheme, with a total estimated cost of £9.1 billion and an average payment of £829 per agreement. The FCA had originally planned for drivers to begin receiving compensation later in 2026, with a target of early 2028 for the majority of payments.
The partial suspension allows firms to continue preparing for the scheme and advancing complaints while avoiding work that may need repetition if the challenges succeed, the FCA stated.
The FCA also said the suspension provides certainty for some consumers sooner by requiring firms to notify complainants who are not owed compensation, subject to limited exceptions.
