PS24/11: Extending the temporary changes to handling rules for motor finance complaints

Read PS24/11 (PDF)[1]

What we are changing

We are extending the DCA complaint handling pause (PS24/1[2]) because it has taken longer to collect and review the data than we planned. There is also relevant ongoing litigation.

Extending the pause will ensure we can prevent disorderly, inconsistent and inefficient outcomes for consumers and knock-on effects on firms and the market while we complete our assessment to decide the best way forward.

Who this is for

This is directly relevant to:

• consumers who have taken out motor finance agreements involving DCAs
• motor finance providers
• motor finance credit brokers, including motor dealers
• professional representatives bringing complaints to motor finance providers, including claims management companies (CMCs) regulated by the FCA

It will also interest consumer organisations and trade bodies representing the motor finance and professional representative sectors.

Next steps

What you need to do.  

Firms affected by these changes must ensure that they continue to comply with the rules in Appendix 5 of the Dispute Resolution: Complaints Sourcebook (DISP App 5[3]) that are relevant to their business. Read ‘Information for firms on motor finance complaints’[4].

Consumers can still complain to firms and there are time limits for doing so. Consumers can check if our work applies to them and how to make a complaint[5].

What we will do

We intend to set out next steps in our review into the past use of DCAs in May 2025.

Background

In January 2024, we set out and explained our response to a potential increase in complaints in the motor finance market.

We are assessing whether the historic use of DCAs means a significant number of individuals could be due redress (compensation) from motor finance firms because they paid too much for their car loans.

If we find there has been widespread misconduct and that consumers have lost out, we will identify how best to make sure people that are owed compensation receive it in an orderly, consistent and efficient way.

For the reasons given in CP24/15 (PDF)[6], we have not completed our diagnostic work. So, we need to extend our temporary complaint handling rules for DCA complaints.