The FCA’s proposed motor finance redress scheme is set to impact millions of agreements and challenge lenders across data, governance, and delivery. To help you prepare, we’ve answered 7 key questions our remediation experts are hearing most often from financial services leaders.
1: What has the FCA announced?
The FCA’s consultation (CP25/27) proposes an industry-wide redress scheme for motor finance agreements between April 2007 and November 2024. Around 14 million agreements may be affected, with total redress exceeding £8 billion.
2: When will lenders need to act?
The consultation closes November 2025. Final rules are expected early 2026, with complaint responses due by July 2026. That’s a tight window to build data pipelines, contact customers, and evidence compliance.
3: What makes this so complex?
This isn’t a single refund exercise. Firms must contact every customer, manage opt-outs, calculate redress using FCA-defined logic, and report progress, all while tracing data that spans nearly two decades. Missing data, broker variability and legacy systems multiply the challenge.
4: Why can’t internal data teams just handle it?
Remediation combines technical, regulatory and operational disciplines. It’s forensic, documented, and auditable. Most in-house data teams haven’t faced that pressure. As Joe Oxley remediation specialist states:
“Remediation has its own rhythm, it’s about precision, documentation, and governance. If firms use general data teams, they’ll miss the pitfalls that specialists know to avoid.”
5: How big is the resource challenge?
Massive. The pool of experienced remediation specialists is small, and shrinking fast as major lenders recruit. Firms that delay will face talent shortages or end up hiring untested contractors, increasing risk of costly errors.
6: What are the consequences of getting it wrong?
FCA fines for previous remediation failings have run into millions of pounds. Beyond penalties, there’s reputational damage, customer backlash, and possible litigation.
7: What can lenders do now?
Start early:
- Assess data availability and quality back to 2007
- Define governance and documentation frameworks
- Begin customer-contact design and data sourcing
- Secure experienced remediation partners before the talent pool dries up
How can Dufrain help?
Dufrain supports lenders from design to delivery, data sourcing, rule definition, governance, reporting and stakeholder management. Our experience across prior FCA-driven remediation programmes means we can accelerate readiness and safeguard compliance from day one.
Want to learn more? Read our further insights in our article Motor Finance Remediation: The Right Expertise Defines Success.