This week the Treasury Committee held a hearing with the Financial Conduct Authority (FCA) to discuss plans for a potential redress scheme covering historic motor finance agreements. The FCA explained that it is currently reviewing around 30 million car finance agreements dating back to 2007. Not all of these will qualify for compensation. The regulator estimates that up to about 14 million agreements may meet the criteria where commission arrangements or disclosure practices could have resulted in an “unfair relationship” under the Consumer Credit Act. Key points raised at the session: Consultation: The FCA intends to launch a six-week consultation in early October 2025 to finalise the scheme’s scope and operation. Timing: Subject to consultation outcomes, the FCA aims for compensation payments to begin in 2026. Data requirements: The FCA stated that “missing records” will not automatically excuse firms from providing redress; it expects lenders to supplement gaps with information from third-party sources such as credit reference agencies where possible. Scheme design: Both opt-in and opt-out models are under consideration. Each approach carries different implications for tracing customers and avoiding duplication of existing complaints (around 60,000 have already been submitted to the Financial Ombudsman Service). NFDA will continue to represent dealers’ interests and feed members’ views into the consultation process. If you are an NFDA member and would like to share your thoughts ahead of the consultation, please contact us directly.