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The UK financial watchdog will consult on an industry-wide redress scheme for consumers “treated unfairly” by car financing agreements, which it estimated would cost lenders between £9bn and £18bn.
The Financial Conduct Authority on Sunday said it would publish detailed proposals on the scheme in October so that consumers could start receiving compensation next year.
The watchdog said Friday’s Supreme Court judgment — which overturned much of an earlier lower court ruling on car finance but upheld one claim of unfair treatment against a lender — had provided helpful “clarity” to decide which consumers should receive redress.
“Where consumers have lost out, they should be appropriately compensated in an orderly, consistent and efficient way,” the FCA said.
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