Dealers and motor finance houses can expect motor finance to shoot up the agenda as Money Saving Expert finance specialist Martin Lewis launches a new campaign highlighting commission payments.
In January the Financial Conduct Authority (FCA) said it was going to investigate historical cases of motor finance companies not paying out compensation to customers for discretionary commission arrangements.
In 2021, the FCA banned discretionary commission, removing the incentive for brokers to increase the interest rate that a customer pays for their motor finance. The FCA asked finance houses to review their practices and, where harm was identified, to address this.
But it said there have been a “high number” of complaints from customers to motor finance firms claiming compensation for commission arrangements prior to the ban. The FCA is scheduled to publish its findings on September 25, 2024.
The FCA has placed a moratorium on companies having to deal with complaints, sol they can handle the expected influx of unhappy customers in an efficient manner.
Last month Lewis told consumers to put in claims for motor finance claims as a ‘marker’ following the announcement by the Financial Conduct Authority that it investigating motor finance commission payments.
On Monday Lewis highlighted his step-by-step guide for consumers to complain. The guide included a free car finance reclaim tool so motorists could bypass professional claims companies that proliferated during the PPI era.
“Even though there’s a pause on firms needing to deal with complaints, it’s important to get your complaint logged sooner, so there’s less chance you’ll be timed out,” he said.