In a statement released today, the FCA has said it is longer planning a further announcement in May and will confirm within 6 weeks of the Supreme Court’s decision if it is proposing a redress scheme and how it will take it forward.
The FCA was granted permission to intervene in the case and filed its submission with the Court. If motor finance customers have lost out from widespread failings, a consultation on an industry-wide redress scheme is likely.
The statement read: “Under a redress scheme, firms would be responsible for determining whether customers have lost out due to the firm’s failings. If they have, firms would need to offer appropriate compensation. We would set rules firms must follow and put checks in place to make sure they do.
“A redress scheme would be simpler for consumers than bringing a complaint. We would expect fewer consumers to rely on a claims management company, meaning they would keep all of any compensation they receive.
“It would also be more orderly and efficient for firms than a complaint led approach, contributing to a well-functioning market in the future.
The FCA’s next steps on non-DCA complaints will be informed by the outcome of the Supreme Court case.
