Martin Lewis boils car finance scandal update down to 'short' summary

Martin Lewis has issued a huge car finance update over the mis-selling scandal - and deduced it into a "short" summary. The BBC and ITV star has spoken out on Twitter, now X, after a social media user got in touch to question today's big development.

The regulator, the Financial Conduct Authority (FCA), announced it's consulting for two weeks (so quick, it's a likely done deal) on extending the time firms have to handle motor finance commission complaints. This is on the back of a Court of Appeal ruling a couple of weeks ago and the extension is to incorporate a potential Supreme Court decision.

Mr Lewis typed: "In short. DCA motor finance claims probably more likely to be paid, more likely to take longer." Previous estimates have put car finance payouts at £1,100. Shortly after his initial post, Martin shared some of his opinions on how the move could affect consumers in the long-term.

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The Financial Conduct Authority (FCA) has confirmed plans to extend the time that car financing groups have to deal with complaints - and this would apply to all commission types. It expects to publish its decision within the next two weeks - but if taken forward, "would mean the complaint extension is in place by mid-December 2024".

It comes after the Court of Appeal ruled last month that customers must be fully informed about commissions when taking out car loans before an agreement can be entered into. The judgment related to fixed commission in motor finance agreements as well as discretionary commission arrangements. The two lenders involved in the case intend to appeal, according to the FCA.

The FCA said car finance providers were “likely to receive a high volume of complaints” following the ruling. The FCA said it has spoken to 63 lenders and consumer representatives about the impact of the court ruling. Its original investigation focused on just discretional commission agreements, which were banned in 2021, and includes personal contract purchases (PCP) and hire purchase.