Can I claim car finance compensation?
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In short: You may be able to if you took out car finance (PCP or HP) before 28 January 2021 and the dealer earned an undisclosed commission linked to your interest rate. The FCA is setting up an industry-wide redress scheme, so you can wait for it rather than pay a claims firm.
Until the FCA banned them in January 2021, many lenders let dealers set the interest rate on car finance and earned more commission the higher the rate — a 'discretionary commission arrangement' (DCA) that was rarely disclosed to customers. Agreements with a DCA before 28 January 2021 are the focus of potential redress.
Following a Supreme Court judgment in 2025 on commission disclosure, the FCA confirmed it would introduce a redress scheme so affected customers can be compensated through a consistent, free process rather than the courts. The scheme's exact scope and timing are set by the FCA.
You do not need a claims management company — they take a cut of any payout. You can complain directly to your lender for free, and if the redress scheme applies it is designed to assess eligible customers automatically. Check fca.org.uk for the latest position before acting.
Primary source: fca.org.uk/consumers/car-finance-complaints