Complaints about car finance commission

This page is for financial businesses dealing with complaints about commission paid by a lender to a car dealer – acting as a credit broker – when arranging a car finance agreement. It also provides:

• information about the temporary complaint-handling rules, which the Financial Conduct Authority (FCA) put in place for certain car finance complaints that use a commission arrangement
• our motor finance commission business response form (PDF 258KB), which will help you supply the detail we need when you come to send us information and evidence about a car finance commission complaint.

We publish separate guidance on other car finance complaints, such as the sale of finance, the affordability of the loan, or charges applied. 

We see complaints about car finance commission that’s paid by lenders to car dealers – acting as credit brokers – on a range of car finance agreements and different commission models. 

Customers contact us because they believe: 

• the way their car finance agreement was arranged was unfair, or 
• the commission wasn’t properly disclosed and had an impact on how much interest they paid or the type of loan they received. 

They haven’t been able to resolve the complaint with the financial business, and so they come to us to investigate what’s happened. 

When they contact us, people tell us that: 

• they weren’t told the credit broker or intermediary – usually a car dealership – would receive commission from the lender for arranging the finance 
• they think the commission model used by the lender was unfair 
• the advice the credit broker gave them wasn’t impartial because of the commission arrangements between the broker and the lender 
• the credit broker didn’t give the consumer the best interest rate available. 

When you receive contact from a customer – including contact that you receive based on, or using, publicly available templates – you need to consider the type of contact or query and respond appropriately .

It is important that you follow the FCA’s:

• temporary complaint handling rules, and
• guidance about dealing with complaints which are not about commission, or where there are exceptional circumstances, such as serious vulnerability.

Promptly responding to customer contacts (including customer enquiries and requests for information) and providing clear information and evidence which demonstrates the commission arrangement that was in place – along with the amounts of any commission payments – might help avoid the need for a complaint.

It is essential that if you are seeking to rely on the regulator’s temporary complaint handling rules – and so aren’t going to issue a final response – you explain this promptly and clearly to your customer.

If you don’t let customers know, they can bring their complaint to us and we will need to then liaise with you to establish your position. If it isn’t clear from the outset what your position is – and therefore our jurisdiction is – the complaint may end up being chargeable for the work we do.

FCA’s review of the historical use of motor finance discretionary commission

In September 2024, the FCA announced it was extending the timeframe of its review into historical discretionary commission arrangements in the motor finance sector. If it finds that consumers have lost out because of widespread misconduct, it will consider how best to ensure that consumers get compensation. It is planning to announce next steps in May 2025.

While the FCA conducts its review, it has introduced temporary complaint-handling rules to certain car finance complaints where  commission arrangements were in place.

It is essential that you continue to investigate and respond to complaints appropriately and promptly in line with the FCA’s revised DISP requirements. And it is crucial that you:

• confirm to customers whether you are seeking to rely on the temporary rules, and
• continue to cooperate with us where complaints are made to our service, in line with your regulatory obligations.

Complaints that were already logged with us won’t be impacted by the FCA’s investigation and will continue through our process.

FCA’s temporary complaint-handling rules to certain car finance complaints

Following the FCA’s consultation on 21 November 2024, the temporary complaint-handling rules have been extended from 20 December 2024 to include all complaints about motor finance agreements where any commission arrangement was in place.

Key features of the rules include: 

• the pause on the eight-week timeframe – in which firms are normally required to provide a final response on complaints and notify consumers of their right to refer their cases to us – which will now continue until 4 December 2025 

• the timeframe for consumers who receive a final response to bring their complaint to us, which will now run until at least 29 July 2026, and 

• extending the requirement for firms to keep consumers informed about the pause and maintain and preserve relevant records, which will remain in place until 11 April 2026. 

You can read more about the complaint-handling rules on the FCA’s website.

The FCA’s rules will apply to complaints where:

• a consumer acquired a motor vehicle on finance, for example car, van, campervan or motorbike – this includes hire-purchase agreements such as personal contract purchases, and motor leasing, or hire, agreements
• the lender and car dealer – acting as credit broker – had a commission arrangement in place, and
• for agreements which were subject to a discretionary commission model, the consumer:
  • acquired the motor vehicle on finance before 28 January 2021
  • made a complaint to the car dealer – acting as credit broker – or lender between 17 November 2023 and 4 December 2025, or
  • received a final response to their complaint from the business between 12 July 2023 and 29 January 2026.

• for agreements which were subject to a non-discretionary commission model, the consumer: 
  • made a complaint to the car dealer – acting as credit broker – or lender between 26 October 2024 and 4 December 2025, or
  • received a final response to their complaint from the business between 21 June 2024 and 29 January 2026.

If a consumer brings their complaint to us – and you haven’t made it clear whether you are seeking to rely on the FCA's temporary complaint-handling rules – we will ask you.

If you don’t respond promptly, we may begin investigating the complaint and charge a case fee. It is important you communicate quickly and clearly to the consumer and us.

You can find more information about the temporary complaint-handling rules on the FCA’s website. 

Complaints about car finance that are not related to commission, or where the consumer is vulnerable 

Your regulator expects and encourages you to send your final response as soon as you can if the complaint is about an issue that doesn’t cover commission. See section 1.39 of Policy Statement 24/18.

We also expect you to carefully consider all complaints where the consumer has a serious vulnerability, for example a terminal illness. This is to prevent consumers waiting longer than necessary to get a resolution to their complaint. 

If the consumer is complaining about another issue where the FCA temporary complaint-handing rules don’t apply, you should continue to investigate the complaint as normal.  

Find out more about how to resolve a complaint. 

As with every case, to reach a decision about what’s fair and reasonable, we consider relevant:  

• law and regulations 
• regulators’ rules, guidance and standards 
• codes of practice 
• what we consider good industry practice at the relevant time 

If there are disagreements about the facts, we’ll make our decision about what probably happened using evidence provided by you, your customer and relevant third parties.  

Judicial review and other court proceedings

Alongside the FCA’s review, ongoing legal action – involving complaints about commission arrangements in motor finance – could have an impact on our work on complaints that involve similar issues.

At present we are waiting for the findings of the Supreme Court. This will be considering an appeal of the recent judgment in Johnson v FirstRand Bank Limited, Wrench v FirstRand Bank Limited and Hopcraft v Close Brothers [2024] EWCA Civ 1106.

On 17 December 2024, the High Court found in our favour, in a review of our decision to uphold a complaint relating to a discretionary commission arrangement (DCA) in a motor finance agreement. We are carefully considering the judgment and what that means for other similar cases that are with us.

While both the FCA review and court proceedings are taking place, we’ll continue to accept and investigate complaints as far as we can. We want to make sure we: 

• have the information we need to decide a complaint as soon as it is appropriate to do so
• can identify whether a complaint is likely to be affected by court proceedings
• can issue investigator provisional assessments, and ombudsman final decisions where appropriate, on cases that are not affected by the legal action.

So that we can identify if a complaint is likely to be affected by either or both of the court proceedings, we will continue to gather information from you and your customers.

It is essential that you continue to cooperate with us where complaints are made to our service, in line with your regulatory obligations.

We will update this page and add an announcement to our news section whenever there is something you may need to know.

Once a complaint has been referred to us and we’ve decided it is something we can investigate, we will ask you to provide information about your side of events.

In deciding whether we can investigate or not, we will of course be considering the FCA’s temporary complaint handling rules. If you provide a final response with referral rights, you are waiving your opportunity to rely on the temporary rules. That gives us jurisdiction over the complaint.

When you respond to our request for information and evidence about a car finance commission complaint, you can use our business response form (PDF 258KB) to help you provide the detail we need.

For a complaint about car finance commission, we typically want you to provide the following: 

• evidence of the amount of commission that was paid by the lender to the car dealer – acting as credit broker – and what commission structure or arrangement was in place. If there were multiple commission payments – or commission models – we will need details of each of these. Supporting evidence could include:
  • invoices
  • the commission contract documentation between the lender and the broker, and
  • system screenshots.

• where the commission structure or arrangement was variable in some way, details of how it was variable – including evidence of the full range of commission payments and interest rates that were available
• documentation or other evidence showing what was explained to the consumer about the commission arrangement at the time they took out the finance agreement. This might be:
  • the initial disclosure document (IDD) or status disclosure document
  • a demands and needs questionnaire or suitability report
  • the finance agreement and any pre-contract documents.
• details of what work was carried out by the broker in arranging the finance agreement and how this related to the commission that was paid.

If we think you have made a mistake or treated a consumer unfairly, we’ll ask you to put things right. Our general approach is that the customer should be put back in the position they would have been in if the problem hadn't happened. 

The exact details of how we’ll ask you to put things right will depend on the complaint, and how the customer lost out. In some cases, we may also ask you to compensate the customer for any distress or inconvenience they’ve experienced as a result of the problem. 

If you want to talk informally about a complaint you’ve received, you can speak to our Business Support Hub. They give general information on how the Financial Ombudsman might look at a particular complaint. They also offer guidance on our rules and how we work.

Find out how to contact our Business Support Hub.

If you're a consumer looking for information, you can read more about how we can help with complaints about car finance commission.  

And if you want to make a complaint, use our complaint checker to see if your issue is something we can help with.