Millions of UK drivers set to receive average payment of £829 each after being mis-sold car finance
Published on Mar 31, 2026 at 11:24 AM (UTC+4)
by Molly Davidson
Last updated on Mar 31, 2026 at 11:28 AM (UTC+4)
Edited by
Mason Jones
Millions of UK drivers are about to receive compensation after a long-running car finance scandal.
The payouts won’t be huge individually, but they add up to something much bigger.
Because this stretches back nearly two decades, and it affects millions of agreements.
And even now, not everyone will get paid automatically.
Enter our competition to win a stunning 2006 Ford GT or $400,000 cash!
Payouts explained and which UK drivers actually get the money
So here’s what’s actually happening.
The UK’s Financial Conduct Authority (FCA) has confirmed around 12.1 million car finance agreements could be eligible for compensation, with average payouts sitting at £829 ($1,050) per deal.
That eligibility comes down to how those finance deals were sold.
In many cases, drivers weren’t told about commission structures baked into their agreements.
That includes discretionary commission arrangements, where dealers could increase interest rates to boost their own cut, as well as high commission setups or clauses like ‘right of first refusal’ that weren’t properly explained.
Because of that, the FCA now considers those agreements potentially unfair.
Timing matters here too.
The scheme covers deals taken out between April 2007 and November 2024, and while some UK drivers will start seeing payouts this year, there’s a process to follow.
Those who have already complained will be first in line.
Everyone else will need to lodge a complaint, with deadlines set for June 2026 for newer loans and August 2026 for older ones.
Importantly, you don’t need a lawyer or claims company to do it.
The FCA has made it clear drivers can go through the process themselves.
Why this car finance scandal turned into a £9.1 billion problem
Zoom out, though, and this isn’t really about £829.
Because across millions of agreements, the total bill for lenders is expected to hit £9.1 billion.
That’s a whopping $11.5 billion.
Making it one of the biggest consumer finance scandals in the UK.
The reason it got this big comes down to incentives.
For years, some lenders and dealers were able to structure deals in ways that increased what drivers paid without making that clear.
Higher interest rates meant higher commissions, and over time, that stacked up across the market.
Now the FCA is stepping in to reset that.
There’s still debate, though.
Compensation will include interest, calculated using the Bank of England base rate plus one percent, with a minimum of three percent each year.
Some legal experts argue that’s too low, pointing out other schemes have paid closer to eight percent.
At the same time, lenders are still reviewing the impact, and there’s potential for legal challenges that could complicate how this all plays out.
Even so, the message is clear.
If you had a car on finance during that window, it’s worth checking.
Because this is one of those rare cases where doing nothing could mean leaving money on the table.
DISCOVER SBX CARS: The global premium car auction platform powered by Supercar Blondie
With roles at TEXT Journal, Bowen Street Press, Onya Magazine, and Swine Magazine on her CV, Molly joined Supercar Blondie in June 2025 as a Junior Content Writer. Having experience across copyediting, proofreading, reference checking, and production, she brings accuracy, clarity, and audience focus to her stories spanning automotive, tech, and lifestyle news.
