Read PS26/3
What we are changing
Most respondents to our consultation (CP25/27) agreed that an industry-wide scheme, free for consumers to use, would be the best, most efficient way to compensate consumers, while ensuring a well-functioning market.
We have listened to feedback and made changes so the final scheme is fair to consumers and proportionate for firms.
The scheme will put £7.5 billion back in people’s pockets with millions of claims settled in 2026 and the vast majority by the end of 2027. And it will provide firms with certainty and finality to support the long-term availability of competitively priced motor finance.
Who this is for
This policy statement will be of interest to lenders, brokers, consumers and consumer organisations, and motor finance and professional trade bodies.
Next steps
There will be a short implementation period so firms can prepare to operate the scheme. This will be up to:
- 30 June 2026 for loans taken out from 1 April 2014.
- 31 August 2026 for those agreed earlier.
Supporting documents
We have published several documents alongside the policy statement:
Background
In October 2025, we published our consultation paper on a proposed motor finance consumer redress scheme (CP25/27) for motor finance customers who were treated unfairly.
In December 2025, we further extended the time (PS25/18) firms have to send final responses to all relevant discretionary commission arrangement (DCA) complaints and non-DCA commission complaints.
