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Wed, 22 Apr 2026

Wed, 22 Apr 2026 Car finance compensation scheme faces challenge and delay

The move could further delay payouts to millions of drivers who were mis-sold motor finance.
A consumer group, Consumer Voice, plans to challenge in court the Financial Conduct Authority's (FCA) compensation scheme for millions of drivers mis-sold motor finance agreements. The scheme aims to cost lenders £9.1 billion and has been criticized for leaving many people "short-changed". Payouts were expected to begin this summer, but the legal challenge could delay these payments. Consumer Voice argues that the FCA's approach to calculating losses is too narrow and will exclude 4.7 million mis-sold agreements from receiving compensation. The group believes the scheme should be revised to ensure fair and lawful payouts for drivers. The FCA has maintained that its scheme is the "quickest, fairest way" to compensate consumers, but Consumer Voice disputes this claim. If successful, the challenge could lead to a more comprehensive compensation package for affected drivers. It's estimated that 12.1 million agreements will be covered by the scheme, but the group claims that many people will still miss out on hundreds of pounds they're owed. The FCA has refused to comment on whether it had been notified of other potential legal challenges to the scheme. Consumer Voice is working alongside lawyers at Courmacs, who are representing over a million drivers seeking payouts via the courts rather than through the FCA scheme. The group plans to file paperwork to the Upper Tribunal on Friday, asking for the scheme to be reviewed and revised.