How to Claim PCP Commission Back in 2026

If you had PCP or Hire Purchase car finance between 2007 and 2024, there is a real chance you are owed money. On 30th March 2026, the Financial Conduct Authority confirmed a £7.5 billion compensation scheme for motor finance customers who were not told about commission arrangements that made their loans more expensive.

This guide explains what happened, whether you qualify, and exactly what to do, step by step. No jargon. No sales pitch. Just the information you need to decide whether to claim and how to do it without paying a penny to anyone.

What is PCP commission and why are you owed money?

When you bought a car on PCP or Hire Purchase, the dealership arranged the finance. That is normal. What was not normal, and what the Supreme Court confirmed could make finance agreements unfair under the Consumer Credit Act 1974 in Johnson v FirstRand Bank Ltd [2024], is what happened between the dealer and the lender behind the scenes.

Many dealers had what is called a Discretionary Commission Arrangement (DCA) with the finance company. Under a DCA, the dealer could increase the interest rate you paid above the lender's minimum rate. The higher the dealer pushed your rate, the bigger the commission they earned from the lender. You paid more every month. The dealer pocketed the difference. Nobody told you this was happening.

This was not a few rogue dealerships. The FCA's investigation found it was an industry-wide practice affecting millions of agreements over nearly two decades.

The result: millions of UK consumers paid more for their car finance than they should have, and they were never given the information they needed to make a fair decision.

The FCA Redress Scheme explained

On 30th March 2026, the FCA published Policy Statement PS26/3: the Motor Finance Consumer Redress Scheme. This is not a proposal or a review. It is a confirmed, mandatory scheme. Lenders are legally required to assess affected agreements and pay compensation where consumers were treated unfairly.

The key figures from PS26/3:

The scheme covers two time periods.

Scheme 1 covers agreements from 6th April 2007 to 31st March 2014. The implementation period for this scheme ends 31st August 2026.

Scheme 2 covers agreements from 1st April 2014 to 1st November 2024. The implementation period ends 30th June 2026.

If Scheme 1 is legally challenged on jurisdictional grounds, Scheme 2 proceeds regardless. Both schemes are being implemented in parallel.

How to check if you qualify

You may be eligible for compensation if your lender or broker did not adequately inform you about at least one of these three arrangements.

1. A Discretionary Commission Arrangement (DCA). The broker could adjust the interest rate you paid to earn a higher commission. If you were not told this was possible, you may have a claim.

2. High commission. The commission amounted to at least 39% of the total cost of credit AND at least 10% of the loan amount. Even without a DCA, undisclosed commission at these levels triggers eligibility.

3. Contractual ties. The lender had exclusivity or a right of first refusal over the broker's finance business. The exception: if the lender can prove there were visible links between the manufacturer and the dealer that made the tie apparent to you.

You only need one of these three to qualify. Most consumers will fall under the DCA category, because discretionary commission was the most widespread practice.

What is excluded?

If you are unsure whether your agreement falls into any of these categories, the simplest approach is to complain to your lender and let them assess it. You lose nothing by asking.

Your four options, and which is fastest

Option 1: Wait for your lender to contact you

Lenders are required to proactively contact consumers who are likely owed money. For Scheme 2 agreements, lenders must contact you by around January 2027.

Pros: You do not need to do anything.
Cons: You will be in the slower queue. Lenders will prioritise existing complainants first. The final deadline to complain is 31st August 2027.

Option 2: Complain to your lender now

This is the fastest route. Complain before the implementation period ends (30th June 2026 for post-2014 agreements) and you are classified as a complainant. Lenders must respond to complainants within three months of the implementation period ending, months ahead of people who waited.

Pros: Fastest resolution. Priority queue.
Cons: You need to write a letter. Frank can draft it in minutes.

Option 3: Use a Claims Management Company (CMC)

CMCs are advertising heavily. They charge 25% to 30% of your compensation. On the average £829 payout, that is £200 to £250 you lose.

The FCA designed this scheme specifically so consumers can access it directly. The FCA has also set up a joint taskforce with the SRA, the ASA and the ICO to tackle poor practices by some CMCs and law firms.

Pros: They handle everything.
Cons: You lose up to 30% of your money for something you can do yourself for free.

Option 4: Use EvenStance (free for PCP claims)

EvenStance's AI assistant Frank will assess your eligibility, draft your complaint letter citing the correct legislation and FCA scheme references, and track your deadlines, all completely free for PCP and motor finance claims.

Step-by-step: how to claim right now

Step 1: Identify your lender

Your claim goes to the finance company, not the dealership. Common lenders include Black Horse, MotoNovo, Close Brothers, Santander Consumer Finance, Alphera, BMW Financial Services, Mercedes-Benz Financial Services, Volkswagen Financial Services, Toyota Financial Services, and Ford Motor Credit.

If you cannot remember the lender, check old paperwork, bank statements (the direct debit will show the lender's name), or your V5C logbook. Alternatively, submit a Subject Access Request to the dealership.

Step 2: Gather what you can (but do not worry if you cannot)

The original finance agreement helps but is not essential. Your lender is legally required to hold records of your agreement. A Subject Access Request under UK GDPR Article 15 produces the file within one calendar month.

Step 3: Write your complaint letter

Your letter to the lender's complaints department should:

Firm and factual. You do not need to prove that commission was hidden; the burden is on the lender. Given how poor disclosure was across the industry, the FCA has said it does not expect lenders to routinely find that cases are outside the scheme's scope.

Step 4: Send and track

Send by email (for speed and a delivery record) or by post. Keep a copy. Note the date. Set a reminder for eight weeks from when you sent it.

If the lender does not respond within the scheme timeframe, or if you disagree with their decision, escalate to the Financial Ombudsman Service. The award limit is £455,000 for complaints referred from 1st April 2026 about acts on or after 1st April 2019, with £205,000 for earlier acts.

How much will you actually get?

The honest answer: it depends on your specific agreement.

The FCA's average across all eligible agreements is £829. Individual amounts vary depending on the loan size, the interest rate, how much commission was paid, and what type of arrangement was involved.

Johnson-aligned cases, approximately 90,000 agreements involving very high commission (at least 50% of the total cost of credit AND at least 22.5% of the loan amount) combined with an undisclosed DCA or contractual tie, will receive a full refund of all commission paid, plus interest.

All other eligible cases receive the hybrid remedy: the average of your estimated financial loss and the commission that was paid, plus interest.

In approximately one in three cases, the compensation will be capped to ensure consumers are not put in a better position than they would have been if treated fairly. The cap is the lowest of: 90% of commission plus interest, the total cost of credit adjusted to the 5th percentile market rate, or the actual total cost of credit calculated on a simplified basis.

Interest is added at the annual average Bank of England base rate plus one percentage point, with a minimum floor of 3% for any year, running from the date you overpaid to the date compensation is paid.

If you had more than one finance agreement in the qualifying period, each is assessed and compensated separately.

What this looks like in practice: a case from the EvenStance founder

The PS26/3 scheme is the fast route for clean commission complaints. It is not the only route for motor finance disputes, and it is not always the best one.

I run my own motor finance dispute on different grounds. I held a hire purchase agreement on a premium German car, taken out in late 2023 from a manufacturer-approved dealership. The agreement was around £63,000 cash price, £1,000 deposit, 60 monthly payments, with a sizeable final payment if I wanted to keep the car. The dealer told me at the point of sale, more than once, that I would be able to change the car at 18 to 24 months without significant financial loss, as I had done across multiple previous finance agreements. That assurance was the primary reason I signed.

Nine months in, I asked for a settlement figure at a routine service visit. The negative equity was approximately £15,500. The dealer's assurance had been false.

I complained to the lender. Roughly six weeks later, the lender sent back a Final Response Letter. The structure was textbook. It misstated my complaint as being "about the interest rate being too high". It attached the pre-contract credit information showing the APR. It attached page 1 of the 14-page signed agreement. It said the dealer "confirmed everything pertaining to the sale was done accordingly". It declined to engage with the specific representation I had complained about. It closed with my right to refer to the Financial Ombudsman within six months.

I referred. The argument that won the case at the Ombudsman was not a commission complaint. It was a misrepresentation complaint under section 56 of the Consumer Credit Act 1974, which makes the lender responsible for representations made by the dealer as the lender's agent during what the Act calls antecedent negotiations.

Two pieces of evidence carried it.

First, a documented pattern. My credit file showed a six-year history of motor finance agreements, with an average duration of around 18 months. The pattern was a record, not a story. The Ombudsman's reasoning quoted it directly: it was "highly likely" I would be looking to change the car after that period, and "highly likely" I would have asked the dealer about it before signing.

Second, the dealer's own contemporaneous WhatsApp messages, recovered through a Subject Access Request to the lender. The messages corroborated the timeline. They did not show the dealer denying the representation; they showed admissions the lender's formal denial could not displace.

The Ombudsman issued a provisional decision in early September 2025. It found, on the balance of probabilities, that the agreement had been misrepresented under s.56 of the CCA 1974. The lender then tried to settle conditional on me dropping a separate unrelated claim against them. The Ombudsman refused to allow the condition. The final decision two weeks later ordered the agreement unwound as if it had never been entered, with the deposit refunded, payments beyond fair use refunded, 8% simple interest on refunded amounts, £250 distress compensation, and removal of all adverse credit-file entries relating to the agreement.

That outcome is not what PS26/3 would have produced. PS26/3 would, at best, have refunded a portion of undisclosed commission with interest. The misrep route unwound the whole agreement.

What that tells you

The PS26/3 commission scheme is the right default for the majority of motor finance complaints, and the cleanest route for most consumers. But it is not the only route, and where you can articulate a specific representation that turned out to be false, supported by a pattern of your own behaviour or by contemporaneous correspondence, section 56 of the Consumer Credit Act 1974 opens a separate door.

The two routes are not mutually exclusive. File the PS26/3 complaint regardless; it costs you nothing and the burden is on the lender. If you also have a specific representation you can point to, run the misrepresentation complaint in parallel through the Ombudsman. The remedies are different. The PS26/3 route is a partial commission refund; the s.56 misrep route can unwind the agreement entirely. The lender's first response to either route will look broadly the same; what changes is which argument you make in your second submission.

The wider lesson: a templated rejection is the lender's process working as designed, not the verdict on your case. The verdict comes downstream, at the Ombudsman or in court. Plan for that from the first letter onwards.

What to do next

The simplest way to start is to talk to Frank, EvenStance's AI assistant. Describe your situation, when you had the finance, who the lender was if you know, and whether you have already complained. Frank will assess your eligibility under both the PS26/3 commission route and (where the facts support it) the s.56 misrepresentation route, draft your complaint letter with the correct legal references, and track your deadlines.

The PCP and motor finance flow on EvenStance is completely free across all tiers. The scheme is live. The lenders are preparing. The sooner you complain, the sooner you are in the queue. Do not pay a CMC to do something you can do yourself in under an hour.