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Home » Martin Lewis says car buyers from 2007-2021 could claim part of £18bn – who can claim
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Martin Lewis says car buyers from 2007-2021 could claim part of £18bn – who can claim

By staff10 August 2025No Comments5 Mins Read

Millions of UK motorists could receive a payout after the Financial Conduct Authority confirmed it will hold a consultation on a redress scheme on hidden car finance commission claims

Beautiful young woman driving a car on the street during the day.
Some people might still be able to claim(Image: Francesco Carta fotografo via Getty Images)

Car and van buyers across the country faced a blow after the Supreme Court dismissed the possibility of compensation for hidden commission payments on car finance loans. In a turn of events the Supreme Court quashed a previous ruling that might have led to millions of motorists receiving compensation for mis-sold car finance.

The UK’s top court sided with finance firms in two out of three landmark test cases, centred on commissions paid by banks and other lenders to car dealerships. This latest judgement overturns earlier court decisions that had opened the door for countless drivers to seek compensation.

Nevertheless, there remains a glimmer of hope for many motorists who entered into a particular type of finance agreement known as a Discretionary Commission Arrangement (DCA). These deals, which were available on Personal Contract Purchase (PCP) and Hire Purchase agreements until 2021, allowed for the potential increase in loan amounts so brokers or dealers could earn higher commissions.

Martin Lewis has said people with children could be owed a tax repayment
Martin Lewis has said people might still be able to claim(Image: Getty)

Money Saving Expert founder Martin Lewis has offered guidance on his website regarding the situation. He has encouraged individuals to lodge a claim regardless, stating there’s “no harm” in trying their luck for a payout.

He advised his followers: “In recent weeks, I’ve been saying ‘do nothing’ as there was so much uncertainty. Now we’re on a firmer base, on the back of what the regulator says, there’s no harm in putting in a complaint to see if you had a DCA. Just do it yourself and use our free complaint tool.”, reports the Express.

He also mentioned: “This may be particularly beneficial in old cases, where you have the details of your car finance but the car finance firm may have deleted it – as this way you put a marker in that you want your case looked at (though again, specifics of this are up in the air).

“In newer cases, complaining now is more about the fact many want to know if they had a DCA and whether they may be due compensation or not. So if you don’t want the hassle, you likely wouldn’t lose out by not putting one in at this point, so could just wait.”

Concept business vehicle finance protection office plan investment
Millions could still get a payout(Image: Getty)

The guidance follows the Financial Conduct Authority’s announcement that it will consult on a redress scheme for hidden commissions in car finance deals, after uncovering that some motor dealers were given commissions from banks or finance companies providing loans, potentially leading to inflated interest rates for customers.

The FCA is planning to consult over a compensation scheme, which could set the industry back anywhere from £9bn to £18bn, acknowledging that “it’s hard to estimate precisely at this stage the total cost to industry of the scheme”, but millions might stand to gain.

The statement reassured those who have already lodged complaints that no further action is required on their part, while urging those who haven’t to approach their car loan provider directly instead of engaging a claims management company.

Nikhil Rathi, the FCA’s chief executive, declared: “It is clear that some firms have broken the law and our rules. It’s fair for their customers to be compensated.”

He continued: “Our aim is a compensation scheme that’s fair and easy to participate in, so there’s no need to use a claims management company or law firm. If you do, it will cost you a significant chunk of any money you get. It will take time to establish a scheme but we hope to start getting people any money they are owed next year.”

The controversy surrounding car finance mis-selling dates back to 2021 when the FCA put an end to DCA deals that allowed dealers to earn commissions from lenders based on the interest rates charged to consumers. The FCA highlighted that such arrangements incentivised dealers to impose unnecessarily high-interest rates, resulting in overpayments by buyers.

Since January, the FCA has been deliberating on whether to issue compensation to individuals who entered into these agreements prior to 2021. The regulator announced plans to launch a consultation in October to determine eligibility and compensation amounts, noting that a recent Supreme Court decision has provided “clarity” on the matter.

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