UK finalises £9B car‑finance redress
The FCA has finalised a £9 billion motor‑finance compensation scheme covering about 12 million agreements from 2007–2024, with average payouts near £830 — a massive operational and compliance task for lenders. The industry bill was trimmed by £2 billion in recent talks, but lenders still face heavy redress automation and reporting workloads. (thecarexpert.co.uk) (irishnews.com)
The FCA published Policy Statement PS26/3 on 30 March 2026 setting out final, statutory motor‑finance redress rules and accompanying technical annexes and guidance. (fca.org.uk). (fca.org.uk) The regulator split the intervention into two statutory schemes — Scheme 1 for agreements from 6 April 2007 to 31 March 2014 and Scheme 2 for agreements from 1 April 2014 to 1 November 2024 — and set discrete implementation windows that end 31 August 2026 (Scheme 1) and 30 June 2026 (Scheme 2), with firms given defined post‑implementation windows to notify complainants and make payments. (regulationtomorrow.com). (regulationtomorrow.com) Firms must supply a one‑off information submission and an implementation plan to the FCA within six weeks of PS26/3’s publication, supported by senior‑manager attestations under the FCA’s supervisory expectations. (auxillias.com). (auxillias.com) Advisers and industry briefs describe this as the largest structured retail redress exercise since PPI and warn lenders they will need to reconstruct historic records, scale document‑intelligence and workflow automation, and remediate millions of legacy files to meet timetable pressures. (tcc.group). (tcc.group) Remediation and technology vendors have mobilised: specialist teams and platforms from Huntswood, DeltaCapita, Profexx and document‑intelligence vendors such as Recordsure are already marketing motor‑finance remediation, automated decisioning and complaint‑handling services to lenders. (huntswood.com). (huntswood.com) Market reaction has been immediate, with shares in major motor‑finance lenders including Lloyds, Barclays and Close Brothers rising as investors priced in the final rules while firms assess implementation costs and provisioning. (uk.news.yahoo.com). (uk.news.yahoo.com) Public Solifi customer rollouts show the kinds of capabilities lenders will need: Kawasaki Motors Finance migrated to Solifi’s Wholesale Finance platform with ERP integration, dealer self‑service portals and improved onboarding, while Rosenthal & Rosenthal implemented Solifi equipment‑finance solutions to expand into working‑capital and equipment lending. (solifi.com). (motorfinanceonline.com)
