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Complaints about motor finance commission
This page is for financial businesses dealing with complaints about commission paid by a lender to a credit broker – often a car dealer – when arranging a motor finance agreement. It covers the Financial Conduct Authority's (FCA) Motor Finance Compensation Scheme rules, the temporary complaint-handling rules, and links to our MFC business response form.
For information on what the legal challenge to the FCA's scheme means, please see the FCA website.
We publish separate guidance on other car finance complaints, such as the sale of finance, the affordability of the loan, or charges applied.
On this page
Do you have a complaint about motor finance commission?
We see complaints about motor finance commission (MFC) that’s paid by lenders to credit brokers – often a car dealer – on different motor finance agreements and commission models. Customers contact us because they believe:
- the way their motor 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.
Rules on MFC and the FCA Scheme
On Monday 30 March 2026, the FCA announced the final rules for its Motor Finance Compensation Scheme covering certain motor finance agreements.
Your firm will need to handle complaints in line with your regulatory obligations. So, we recommend that you familiarise yourself with your obligations under:
- the scheme rules, and
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DISP, including DISP App 5.
The publication of the scheme means different things for different types of complaints. Your firm should read the final FCA rules and guidance carefully and consider what they mean for the cases that you have. Broadly speaking, this means:
- As of 31 March 2026, we are not taking on MFC complaints that are part of the scheme – that is, ‘scheme cases’.
- For complaints that fall under the scheme, your firm will need to consider those complaints in line with the scheme rules and time frames.
- Where your firm issues final response letters for complaints that fall outside of, or are exceptions of the scheme, we will look at those complaints in the usual way.
- For complaints about the scheme, we will require your customers to have a redress determination before we look at the complaint – unless the deadline for providing a redress determination has passed. If a customer comes to us before a redress determination has been issued, we will ask them to go back to your firm to request one.
We’re considering the scheme rules in detail and are looking to introduce processes to help consumers avoid making complaints prematurely.
The FCA has given financial businesses an implementation period to enable them to prepare for deciding cases under the scheme. The implementation period depends on when the agreement was taken out.
The scheme is unlikely to cover complaints relating to motor finance commission that customers brought to us before 30 March 2026, which we have yet to determine. We will continue to investigate these complaints and give customers an answer.
The complaints handling pause ends on 31 May 2026. The FCA has published more about this on its page of information for firms on motor finance complaints.
How we resolve complaints about motor finance commission
To reach a decision about what’s fair and reasonable for motor finance commission complaints that are already with us, we'll consider the relevant:
- law and regulations
- regulators’ rules, guidance and standards
- codes of practice.
If there are disagreements about the facts, we’ll make our decision about what most likely happened using evidence provided by you, your customer and relevant third parties.
To decide whether we can investigate or not, we will of course consider the FCA’s temporary complaint handling rules. If you provide a final response with referral rights, you have chosen not to rely on the temporary rules. That gives us jurisdiction over the complaint.
Once your customer has brought a complaint to us and we’ve decided it is something we can investigate, we will ask you to provide information about your side of events.
When you respond to our request for information and evidence, please use our motor finance commission business response form to help you provide the detail we need.
For a complaint about car finance commission, we’ll typically want you to provide:
- 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, how this related to the commission that was paid and whether any form of commercial tie was present.
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Following the Supreme Court judgment in Johnson and the Court of Appeal dismissing a high street bank’s appeal against the High Court judgement that had found in our favour, we are carefully considering what that means for other similar cases that are with us.
Now the FCA has published its scheme and the court proceedings have finalised, we’ll continue to investigate complaints as far as we can. We want to make sure we:
- can identify whether a complaint is caught by the complaints pause
- have the information we need to decide a complaint as soon as it is appropriate to do so
- can issue investigator provisional assessments and ombudsman final decisions where appropriate
So that we can identify if a complaint is likely to be affected by the complaints pause – and to give timely answers on complaints where it’s not – 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.
If we think you have made a mistake or treated a consumer unfairly, we’ll ask you to put things right. We may also ask you to compensate your customer for any distress or inconvenience they’ve experienced as a result of the problem.
If it's a scheme case, we’ll only consider whether you have correctly handled the case in line with the scheme rules.
Business Support Hub
Businesses and consumer advisers can contact our Business Support Hub on 020 7964 1400 for information on how we might look at a particular complaint, or for guidance on our rules and how we work.
We also work with businesses and other organisations to help prevent complaints.
Previous updates
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The Financial Conduct Authority (FCA) removed temporary rulesFinancial Conduct Authority (FCA) has removed temporary rules extending how long you have to reply to complaints about the leasing of vehicles.
How this affects complaints about car finance commission
This means that the normal time limits as set out in DISP 2.8DISP 2.8 will once again apply to complaints about leases. So you will need to:
- respond to complaints within eight weeks, and
- consumers will be able to refer their complaint to us after the eight weeks are up.
They then have six months from the date of that response to refer complaints to us if they’re not satisfied with your response. This includes all complaints received on or after 26 October 2024.
The temporary complaint handling rules covering the more common finance agreements – such as hire purchase agreements, personal contract purchase agreements, or conditional sale agreements – were extended from 4 December 2025 until 31 May 2026.
This means you don’t have to provide a final response to those complaints at the moment.
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The Court of Appeal dismissed the appeal by a high street bank against a High Court judgement that had found in our favour.
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.
Separately, we're expecting the Financial Conduct Authority to publish its consultation on a proposed redress scheme for motor finance complaints sometime in October.
How this affects complaints about car finance commission
Following this court ruling, we’re carefully considering next steps for motor finance commission cases with our service. We will update customers directly as soon as we can. There's no need to contact us in the meantime.
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We are aware of the Supreme Court judgement in the case of 'Johnson, Wrench and Hopcraft' and are currently considering its impact on our approach to complaints about related issues.
Read the Supreme Court judgement in the case of Johnson, Wrench and Hopcraft
Separately, the Court of Appeal hearing, which was adjourned on 1 July 2025, will now take place from 16 to 18 September 2025.
How this affects complaints about car finance commission
We will update customers directly about next steps as soon as we can. There's no need to contact us in the meantime.
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The Court of Appeal has adjourned the appeal of the High Court’s 2024 judgement on the judicial review of one of our decisions, which upheld a complaint about motor finance commission.
The appeal – which was originally requested by a lender and due to take place from 1 to 3 July 2025 – won't be heard now until after the Supreme Court’s judgement has been given.
At this point, the next steps in this judicial review are unclear and we don't when the Court of Appeal hearing will take place.
How this affects complaints about car finance commission
We won't be able to settle a number of complaints on car finance commission until after this hearing.
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The FCA has announced temporary rules to extend how long:
- firms have to respond to motor finance complaints where a ‘non-discretionary commission arrangement’ was involved, and
- consumers have to refer complaints to us.
This means that the rules for all complaints about motor finance agreements where there were commission arrangements in place are now in line with those announced in January 2024, which covered agreements linked to discretionary commission arrangements.
Ongoing legal action – involving commission arrangements in motor finance – could also affect our work on complaints involving similar issues.
So the findings of the Supreme Court – which will consider an appeal of the recent judgement in Johnson, Wrench and Hopcraft in early 2025 – might be something we need to think about.
How this affects complaints about car finance commission
- Financial businesses have until 4 December 2025 before they have to start responding to complaints again.
- As a customer, you have longer to bring your complaint to us – until at least July 2026.
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On 17 December 2024, the High Court found in our favourLink is external ,High Court found in our favourHigh 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.
How this affects complaints about car finance commission
We are carefully considering the judgement and what that means for other similar cases that are with us.
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The Court of Appeal ruled that it was against the law for brokers to receive a commission of any kind from lenders providing motor finance, without the customer’s informed consent.
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The FCA introduced rules for handling motor finance complaints where there was a 'discretionary commission arrangement' (DCA) between the lender and the broker of the loan.
How this affects complaints about car finance commission
The new rules extended the time financial businesses have to respond to these complaints until after 4 December 2025.