Car finance commission – make a claim to the FCA scheme

The FCA Car Commission Compensation Scheme was announced on 30 March 2026.

The FCA estimates that about 12 million HP & PCP agreements that started between 2007 and late 2024 may be eligible for a refund, averaging £829.

Let’s look at some of the details and what you should do now.

What car finances are eligible for a refund?

Finance types and dates

The finance types covered are Personal Contract Purchase (PCP) and Hire Purchase (HP).
Leased cars (PCH) are not included in this scheme.
If you got a loan and choose to buy a car with it, that is not car finance, and it isn’t included.
Finance taken out by a company is not included.

Vehicle types covered are cars, vans, motorbikes and campervans. Caravans are not included – but if you had a caravan on HP this may have had an unfair discretionary commission arrangement (see below for more about DCAs) so you can make a complaint to the lender about this outside the scheme.

Start and end dates – the finance agreement must have started between 6 April 2007 and 1 November 2024.
The finance may have ended, or it may still be running.
You may have sold the car later.
You may have defaulted on the agreement or had the car repossessed.
(If you have defaulted on an agreement in the last few years, look at an affordability complaint which may get you a larger refund than a commission reclaim.)
None of this matters for a commission refund – what matters is when the finance agreement started.

The three reasons why an agreement may be “unfair”

To get a refund, the commission arrangements on your car finance have to be unfair for at least one of the following three reasons:

Discretionary commission arrangements (DCAs)
This is the largest category, covering over 10 million agreements. These DCAs meant that you may have paid more interest than you should have. That extra interest was set by the dealer or broker as their commission.

Unfairly high commission
This may apply to  over 2 million agreements
This is seen as unfair if the commission is a high percentage of the costs of the finance and the size of the loan.
There is also a “very high category” when the refund will be calculated more generously and will be a lot more – this will be rare, under 100,000 agreements.

Contractual ties
This may apply to over a million agreements.
You may have thought the dealer or broker was finding you the cheapest finance they could. But they may have had an raangement that they always used one lender. So this may not have been the cheapest.

If there was an obvious link, you would have expected this, so it isn’t unfair. I got a Toyota from a Toyota dealer and I was not surprised when the financing came from Toyota Finance. But this may still be unfair for another reason eg if there was a DCA used.

Minor exclusions

There are some minor exclusions from the Scheme including:

• Claims for very high value loans – amounts higher than 99.5% of other loans that year – are not covered by the scheme. You can still complain to the firm and the Financial Ombudsman about these large loans
• The commission was very low – £120 or less for agreements beginning before 1 April 2014 and £150 or less from that date
• The finance was at 0% interest – you couldn’t have got this cheaper by going elsewhere

How much may a refund be?

Calculating a refund

It is normal to have paid some commission on car finance. The scheme estimates how much extra commission you may have paid because of the unfairness – the refund is that amount.

In the small number of very high commission cases, all the interest paid is refunded.

FCA estimates of refund amounts

The FCA estimates that the average refund for upheld cases will be:

• £881 for contracts that started after April 2014
• £734 for contracts that started before April 2013

It has given estimates of the average refunds by the reason for the unfairness:

• DCA commission – £810
• high commission – £1,203
• contractual tie – £807

Ignore this next bit if this is all too many numbers…

The FCA also gives the estimated median averages. If you list all the refunds in size order, the median is the middle one, so half the people getting a refund get less and half get more than that.

In all the FCA cases, the median averages given are lower than the mean. For example, the median payout for a DCA case is expected to be £641, less than the mean average of £810.  This happens when there are some very big expected payments which increase the mean payment.

Refunds are per case

You make a separate claim for each car finance agreement in the period. So the above numbers are estimates for each individual case.

If you had 4 agreements during the 2007-2024 period and two are upheld as unfair, you will get two refunds.

How likely is your claim to be upheld?

The FCA estimates that:

• 34% of agreements may have had a DCA agreement
• 8% of agreements may have had an unfairly high commission
• 4% of agreements may have had an unfair contractual tie.

Don’t count your chickens…

In general you are likely to have paid more commission and so may get a bigger refund if the interest rate was high or the loan amount was large.

But beyond that, it’s very hard for you to guess if your case will be upheld or how much you might get back.

This is a very uncertain process. Some people with several claims may not win any of them, some will win them all. You may lose some and win some even if you always got your cars from the same dealer and the same finance provider.

The timetables for claims and refunds

The general approach

If you complain early, your case gets priority. You will be told if the claim is upheld sooner and you will be paid sooner.

If you choose not to complain, the lender will later contact you if you have an eligible complaint.

The FCA has set up two schemes with different timetables depending on when your finance agreement started:

• one scheme is for older contracts that started before April 2014
• the other is for more recent contracts.

The second scheme, for more recent loans, starts first and the refunds for these loans will be paid earlier.

Quick summary – newer loans are paid before older loans, and you are paid much earlier if you complain now.

The timetable for older loans that started pre 2014

It is estimated that over 4 million of these cases should get a refund.

If you complain before 31 August, the lender will tell you if you are due a refund and how much by 30 November.
After you accept the offer, it should be paid within a month, so end 2026/early 2027.

If you don’t complain to the lender before 31 August, the lender will contact you by 28 February 2027 if you’re eligible for a refund.
You then have to reply within 6 months saying you want to be included in the scheme.
The lender then has 3 months to tell you what you are owed and another month to pay it.
So payments will be in the last half of 2027.

The timetable for loans from 2014

It is estimated that nearly 8 million of these cases should get a refund.

If you complain before 30 June, the lender should tell you if you are due a refund and how much by 30 September.
If you accept the offer, it should be paid within a month, so about November 2026.

If you don’t complain to the lender before 30 June, the lender will contact you by 30 December 2026 if you’re eligible for a refund.
You then have to reply within 6 months saying you want to be included in the scheme
The lender then has 3 months to tell you what you are owed and another month to pay it
So payments will be from April – Sept 2027

What should you do now?

If you haven’t yet made a claim for all previous finances

SEND IN A COMPLAINT NOW !

You could sit back and hope the lender contacts you. But that may take nearly a year longer to get a payout as the early complainers get priority.

Also if you have moved, the lender may not find your current address. Making a complaint now solves this problem as you give your contact details

Use MSE’s free tool to send in a complaint: MSE complaint generator.

If you can’t remember all your finances, or who the lenders were, Equifax, the credit reference agency, now has a free Car Finance Checker app. This has details of most car finance records since 2007. You can find more details, including a link, in the MSE free tool page.

If you have made a claim

You may not need to do anything:

• if you have been told you paid a DCA, you will be getting a refund (unless the extra commission was tiny). You don’t need to do anything now – you will be in the early batches of payouts
• if you haven’t yet had a response, don’t worry! You have complained before the start of the scheme, you will get a response and will be in the early batches of payouts.

BUT if you complained early, your complaint will only have asked if there was a DCA on your finance agreement. Here if you have been told you did not pay a DCA, you may still qualify for a refund for one of the other two reasons.

Some lenders will have told you that they have automatically raised a non discretionary commission complaint for you. But if you havn’t be told this, then to make sure you get one of the early payouts, you need to complain again.  Use the same MSE tool, it is not updated to cover more than just DCAs.

If you have already signed up with a claims firm or firm of solicitors, you will often be charged a fee to exit the contract. But as you don’t know what (if any) refund you may get, it may be hard to decide what to do. There are some more details in the MSE tool.

Summary

12 million unfair car finance contracts since 2007 – that’s a lot. And more people may get refunds than seemed likely in early 2024, because the “unfairness” reasons have been extended to include high commission and contractual ties you were unaware of.

There is no way you can tell if your car finance should get a refund:

• looking at the finance paperwork (if you still have it) doesn’t help;
• you may have been overcharged commission even if the finance was easily affordable for you.

I suggest you make a claim for each HP or PCP car finance agreement you have had that started between 2007 and late 2024, unless the finance was at 0% interest.

Making a claim now is easy to use the MSE free tool. And the free Equifax car agreement checker app helps by giving you the details of most of the old car finances you have had.

This article was rewritten for the new Scheme in March 2026 

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