FCA Urges Car Finance Customers to Complain for Free

The Financial Conduct Authority (FCA) is urging motorists who think they may be owed compensation over car finance to complain directly and for free, rather than paying claims management companies or law firms to act on their behalf.

As part of a new £2 million national advertising campaign, the regulator has launched a free complaint template to help consumers contact their lender themselves. The FCA says some claims companies can charge up to 30% of any compensation, meaning customers could lose a significant share of any payout they receive.

The campaign follows growing awareness of the long-running motor finance commission scandal, which centres on whether customers were charged higher interest rates because of commission arrangements between lenders and motor dealers. Research commissioned by the FCA found that more than one in four customers lack the confidence to complain without paying a third party, despite free help being available.

The FCA stressed that this is not a new compensation scheme. It introduced an industry-wide £7.5 billion redress scheme earlier this year, but parts of the scheme have since been suspended by the Upper Tribunal while legal challenges are heard. This means compensation payments remain subject to the outcome of those proceedings.

For consumers, the key message is simple: you do not need to pay anyone to make a complaint. The FCA's free complaint template is available online, and anyone who believes they may have been affected can contact their lender directly. Using the free process means any future compensation would not be reduced by claims management fees.

The advertising campaign runs across television, radio, newspapers, billboards and social media until 6 September, aiming to help more people understand that they can complain themselves without paying for assistance.