\n<\/p>\n
Up to 14 million victims of the UK\u2019s car finance scandal look likely to receive compensation payouts averaging \u00a3700.<\/p>\n
The payouts would be less than previously expected, but announcing the plans for compensation on Tuesday, the Financial Conduct Authority (FCA) said that lenders could be landed with an \u00a38.2bn compensation bill, though it could go as high as \u00a39.7bn.<\/p>\n
The City regulator\u2019s long-awaited proposals for a compensation scheme cover millions of motor finance agreements taken out between April 2007 and November 2024.<\/p>\n
This relates to the alleged large-scale mis-selling of car loans involved in the payment of \u201csecret\u201d commissions to car dealers, and millions of car buyers unknowingly paying more for their finance than they should have.<\/p>\n
Launching a consultation, the FCA said that based on the number of consumers it estimated could take part in the scheme, lenders could be landed with an \u00a38.2bn compensation bill, although it could go as high as \u00a39.7bn.<\/p>\n
The FCA said in August that it estimated \u201cmost individuals will probably receive less than \u00a3950 in compensation per agreement\u201d. At that time it said it was unlikely the cost of the scheme would be much lower than \u00a39bn, and could be up to \u00a318bn.<\/p>\n
The vast majority of new cars and an increasing number of used vehicles are bought with motor finance \u2013 typically either a personal contract purchase plan or a hire purchase agreement. In a typical year there are about 650,000 motor finance agreements in the new car market.<\/p>\n
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Sign up to Business Today<\/span><\/p>\n Get set for the working day \u2013 we’ll point you to all the business news and analysis you need every morning<\/p>\n Privacy Notice: <\/strong>Newsletters may contain information about charities, online ads, and content funded by outside parties. If you do not have an account, we will create a guest account for you on theguardian.com to send you this newsletter. You can complete full registration at any time. For more information about how we use your data see our Privacy Policy. We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply.<\/span><\/p>\n after newsletter promotion<\/p>\n This looks likely to be the biggest mass payout relating to a financial product since the payment protection insurance (PPI) mis-selling debacle, which led to 34 million consumers receiving an average of about \u00a31,000 each.<\/p>\n","protected":false},"excerpt":{"rendered":" Up to 14 million victims of the UK\u2019s car finance scandal look likely to receive compensation payouts averaging \u00a3700. The payouts would be less than previously expected, but announcing the plans for compensation on Tuesday, the Financial Conduct Authority (FCA) said that lenders could be landed with an \u00a38.2bn compensation bill, though it could go<\/p>\n","protected":false},"author":1,"featured_media":26507,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[56],"tags":[15911,1110,1495,5774,7117,4852,2015,7119,8391,2963,2933],"class_list":{"0":"post-26506","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-crime-justice","8":"tag-14m","9":"tag-average","10":"tag-car","11":"tag-fca","12":"tag-finance","13":"tag-line","14":"tag-loan","15":"tag-motor","16":"tag-payout","17":"tag-scandal","18":"tag-victims"},"_links":{"self":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/26506","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=26506"}],"version-history":[{"count":0,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/26506\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/media\/26507"}],"wp:attachment":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=26506"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=26506"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=26506"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}