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Tue, 03 Nov 2026

Tue, 03 Nov 2026 Drivers may get compensation offers before car finance saga ends

The regulator says it supports lenders offering early compensation offers, as long as they are fair.
Drivers affected by car finance mis-selling may be offered compensation from lenders before a court case next year. The Financial Conduct Authority (FCA) welcomes early settlement offers as long as they are not worse than its proposed central scheme. Some lenders, including Barclays, have confirmed that they will make early compensation offers to drivers. However, the FCA expects only a minority of claimants to receive these offers, with most waiting for the outcome of next year's court case. The average compensation payout is expected to be around £829, related to about 12 million car loans. The total cost to the industry could be up to £9.1 billion. Barclays has decided to start making early settlement offers to customers who have already been waiting for a considerable time. Other lenders are also likely to follow suit. The FCA has published a factsheet to help drivers understand whether they should accept early settlements from lenders. The regulator will closely monitor firms making offers and expect them to be clear about what accepting an offer means. Individual payouts will vary, depending on the degree of harm each driver faced. Some drivers may receive lowball offers, while others may not receive any offer at all. The main proposed FCA scheme remains partially suspended, pending legal challenges in February. The outcome of this court case is likely to determine when compensation payments will be made.