Connect with us

Hi, what are you looking for?

Top Stories


FCA Vows Swift Response to Car Loan Issues

<?xml encoding=”utf-8″ ?????????>

The chief regulator of the City has hinted at likely failings by some companies in concealing commissions charged on car loans.

Nikhil Rathi, CEO of the Financial Conduct Authority (FCA), suggested that redress for these failings wouldn’t approach the scale of the infamous £50 billion bill for mis-sold payment protection insurance (PPI).

Speaking at a City conference, Rathi emphasized that it was “improbable we will find nothing to report” as the FCA scrutinizes historic motor finance sales. However, he reassured that the ensuing investigation and compensation arrangements wouldn’t mirror the prolonged and costly saga of the PPI scandal. Rathi cited the FCA’s early intervention as a factor in expediting the process, unlike the protracted nature of the PPI debacle.

The focus of the scandal lies on undisclosed commission arrangements that incentivized car retailers and motor finance brokers to promote excessively expensive credit to car buyers. The FCA outlawed these discretionary commissions in 2021 and commenced an investigation into the practice dating back to April 2007. Estimates by brokers at Jefferies suggest the sector-wide bill could potentially reach £13 billion, with major players like Lloyds Banking Group and Close Brothers bracing for financial impact.

While consumer champion Martin Lewis has speculated on the scale of the scandal, drawing parallels to PPI, Rathi affirmed a more streamlined approach to resolving motor finance failings. He stressed the importance of firm cooperation and prompt data provision, highlighting a condensed timeline for resolution.

In response to concerns about the new consumer duty’s stringency, Rathi reassured the industry, signaling the FCA’s willingness to acknowledge firms’ efforts to address concerns without seeking to impede them with technical breaches.

Moreover, Rathi indicated the regulator’s openness to banks considering charges for current accounts, sparking concerns about the end of free banking for those in credit. Despite these shifts, the FCA remains committed to fostering a fair and transparent financial landscape, balancing consumer protection with industry viability.

You May Also Like


As the world seeks sustainable and energy-efficient solutions for heating and cooling, the heat pump market is experiencing a significant surge. According to the...


The introduction of aggressive climate objectives by global economies and growing prospects for reducing carbon emissions are driving the growth of the district heating...


In the dynamic automotive sector, consistent growth of the electric vehicle (EV) charging industry has become increasingly evident. Consumers and businesses alike are recognizing...


With a higher focus on sustainable living in modern architecture, the building automation systems (BAS) industry stands as a beacon of innovation. These systems...

Disclaimer:, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice.
The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2024 Secrets Of Richdads. All Rights Reserved.