The motor finance redress scheme is built to find you. A claims company is now pure cost.

On 11th June the FCA quietly updated its firm guidance for the motor finance redress scheme. No press release, just a fresh document for firms working through what they owe and to whom. It lands two weeks before the date that actually matters to a consumer: 30th June, when firms running Scheme 2 reach the end of their implementation period and have to start confirming, customer by customer, whether money is owed and how much. Scheme 1, covering the older agreements, runs to 31st August.

Most of the coverage this fortnight has been about delay. The FCA confirmed on 9th June that it does not expect a court hearing on the legal challenge before October, which means actual payments probably slip to November or later. The honest summary of the news cycle is "you will not get your money this summer." That is true. It is also the least useful thing you could take from it.

The fact worth holding onto is structural, and it is in the design of the scheme itself. PS26/3 puts the work on the firm, not on you. Lenders have to go back through agreements written between 2007 and 2024, identify customers who were treated unfairly on commission, calculate the redress, and contact them. You do not have to file anything to be found. You do not have to know your agreement number, your commission percentage, or the name of the discretionary arrangement your dealer never mentioned. The firm has to work that out and come to you. That is the whole point of a redress scheme as opposed to a complaints process: it flips the burden.

Which is exactly why the parasites are circling, and why the regulators have spent the spring pulling their wings off.

The claims industry has no job here, and it knows it

A claims management company exists to do a thing you find hard: identify a claim, package it, chase it. When the regulator orders the firm to identify and chase the claim for you, the CMC's product disappears. What is left is a form, your details, and a fee of fifteen to thirty per cent skimmed off redress that was coming to you anyway.

The regulators saw this coming and moved early. On 30th March the FCA, the Solicitors Regulation Authority, the Information Commissioner's Office and the Advertising Standards Authority launched a joint taskforce aimed squarely at poor practice in motor finance claims. Not at lenders. At the firms claiming to help consumers. The targets named were unsolicited and misleading advertising, meritless claims, the same person being represented by two firms at once, and unfair exit fees for customers who tried to leave.

The numbers they have published since are the tell. More than a thousand misleading motor finance adverts removed or amended. More than 28,000 consumers helped out of CMC contracts free of charge. Three CMCs made to cut their fees, which the FCA says protects over 500,000 people. Then on 6th May the FCA went further and opened a market study into the whole claims management sector, with information requests going to firms this month and early findings due in December. You do not launch a market study into an industry you think is adding value.

Read those two strands together. One regulator action builds a machine that pays consumers automatically. The other dismantles the businesses that were going to charge consumers for standing next to that machine. They are the same policy.

What to actually do before 30th June

This is not "do nothing." It is "do the right small things, and pay no one a percentage to do them."

Find your paperwork. If you bought a car on finance between 2007 and 2024, dig out the agreement, the dealer invoice, anything with a date and a lender name. The firm has to find you, but you make it faster and harder to fob off if you can confirm the agreement the moment they make contact.

Check who holds the agreement now. Lenders merge and sell books. If your original lender was bought, the redress duty followed the agreement to whoever owns it. Know the current name.

Make sure they can reach you. The single way to fall through a redress scheme is a dead address or an old email. If you have moved since the agreement ended, update your details with the lender now, in writing, with a copy kept.

If a CMC has already signed you up, read the exit terms. The taskforce has been forcing unfair exit fees down precisely because so many people want out once they realise the scheme reaches them directly. You are very likely entitled to leave free of charge. Ask.

The delay to November is real and it is frustrating. But a delay is a timing problem, not a money problem. The money is defined by the scheme and owed by the firm whether you wait quietly or pay a stranger thirty per cent to wait on your behalf. I have watched people hand over four figures to a claims company for redress that would have arrived in their account anyway. The scheme was built so that does not have to happen. Keep your own paperwork, keep your address current, and keep your hand on your wallet.

Also worth your time this week

A quieter week after a busy fortnight. The other items worth knowing about:

• Motor finance redress guidance updated. On 11th June the FCA published further guidance for firms running the motor finance consumer redress scheme (PS26/3). The Scheme 2 implementation deadline is 30th June, with firms then having until 30th September to confirm what each customer is owed. Scheme 1 runs to 31st August.
• But payouts are slipping. The FCA confirmed on 9th June it does not expect a court hearing on the legal challenge to the scheme before October, which pushes likely payments to November or later. The scheme rules are live; the money is not imminent.
• The claims companies are still in the regulators' sights. The joint FCA, SRA, ICO and ASA taskforce on poor motor finance claims practice continues, having already had more than 1,000 misleading adverts pulled and helped 28,000 people exit claims contracts free of charge. The FCA's wider claims management market study sends information requests to firms this month.
• Martin Lewis names his three laws. On his 2nd June podcast, Lewis picked bailiff regulation, easier redress for faulty products, and locked-in student loan terms as the consumer laws he would introduce given the chance.
• Which? on loyalty pricing. A 9th June Which? analysis looked at how much more shoppers pay at major supermarkets without a loyalty card.
• Ofcom raises broadband compensation. Automatic compensation for broadband and landline faults has gone up: £10.34 a day for delayed repairs and £32.31 for a missed engineer appointment.
• Data complaint right approaching. From 19th June, the Data (Use and Access) Act 2025 brings in a new statutory right to complain about how your personal data is handled.

If you bought a car on finance between 2007 and 2024, the most useful thing you can do this month costs nothing: find the paperwork and make sure your lender has a current address for you.

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