The position in one paragraph
The FCA's redress scheme covers an estimated 12.1 million motor finance agreements, with total redress expected to reach around £7.5 billion and an average payout of £829 per agreement (FCA, PS26/3, 31 March 2026). The scheme itself is made law but partially suspended: the FCA confirmed on 2 July 2026 that the Upper Tribunal had suspended parts of it while it hears four separate legal challenges, and the Tribunal has now confirmed those challenges will be heard either 14 to 18 December 2026 or 16 to 26 February 2027, with judgment expected some months after that. Realistically, that means payments under the scheme are unlikely before some point in 2027. Separately, and this is genuinely a different thing, the Court of Appeal ruled on 30 June 2026 that a group of over 5,000 motor finance customers can bring their claims together through the ordinary courts, using what's called an omnibus claim, in Angel v Black Horse Ltd. That route doesn't wait for the Tribunal and doesn't depend on the scheme's outcome, but it also doesn't come with the scheme's more consumer-friendly presumptions, more on that distinction below.
Full timeline
1 August 2025, Supreme Court judgment
The Supreme Court ruled on Johnson v FirstRand Bank Ltd and two linked appeals. It rejected the broader argument that car dealers owed customers a duty as agents when arranging finance, but confirmed that the unfair relationship test under section 140A of the Consumer Credit Act 1974 remains available. This judgment is the legal foundation both the FCA's scheme and the separate Angel litigation were built on.
7 October 2025, FCA consultation opens
The FCA published consultation paper CP25/27, proposing an industry-wide scheme covering PCP and HP agreements from April 2007 to November 2024. Initial modelling estimated 14.2 million agreements potentially in scope, total redress of around £7.5 billion, and an average payout of approximately £700 per agreement.
31 March 2026, final rules confirmed
The FCA published policy statement PS26/3, confirming the scheme in its final form under sections 404 and 404A of the Financial Services and Markets Act 2000. The eligible agreement estimate was refined down to 12.1 million, and the average expected payout rose to £829 per agreement, reflecting a more consumer-favourable calculation method than originally consulted on.
8 May 2026, four legal challenges confirmed
The FCA confirmed the scheme was being challenged in the Upper Tribunal by four parties under section 404D(1) of FSMA: the consumer rights group Consumer Voice, and three lenders, Mercedes-Benz Financial Services, Volkswagen Financial Services and CA Auto Finance UK. Consumer Voice's challenge argues the FCA's calculation method may under-compensate some consumers, not that the scheme goes too far, if that challenge succeeds, it could mean higher redress, not less.
31 May 2026, complaint handling pause lifts
The FCA's pause on complaint handling, in place since January 2024, ended on 31 May 2026. Lenders were required to resume progressing complaints, though for complaints falling within the scheme, the actual offer and payment still depends on the Tribunal outcome.
30 June 2026, Court of Appeal upholds the omnibus court route
In a separate piece of litigation from the FCA scheme entirely, the Court of Appeal handed down judgment in Angel v Black Horse Ltd, upholding an earlier High Court decision that around 5,800 motor finance claimants can bring their claims together in the county courts using omnibus claim forms, rather than each having to issue an individual claim. This gives consumers a court-based route that exists whether or not the FCA scheme survives its own legal challenges, though it works differently.
2 July 2026, scheme partially suspended, hearing dates set
The Upper Tribunal made an order suspending parts of the redress scheme, on terms agreed between the FCA and the four challengers, which the FCA confirmed publicly on 2 July. Lenders no longer have to calculate or pay redress, or send compensation communications on the original scheme timetable, while the challenges are heard. They still have to identify relevant complaints and agreements, gather commission and disclosure data, and respond to anyone who is told they are not owed anything under the scheme by the normal deadlines. The Tribunal also confirmed the challenges will be heard either 14 to 18 December 2026 or 16 to 26 February 2027, with the final date expected to be confirmed around October 2026.
The Angel ruling and the FCA scheme are not the same thing
It's easy to see two sets of court and regulatory news about motor finance commission and assume they're the same story. They're related, but they work differently, and the difference matters if you're deciding what to do.
The FCA scheme is a regulatory redress mechanism. If your agreement falls within it, it works in your favour in one specific way: firms have to presume there was an unfair relationship where commission wasn't disclosed, rather than you having to prove it. That presumption is exactly what's currently suspended pending the Tribunal challenges.
The Angel omnibus route is an ordinary civil claim, brought through the courts under section 140A of the Consumer Credit Act in the normal way, just with many claimants grouped together in one set of proceedings rather than each bringing a separate case. It doesn't benefit from the scheme's presumption. You, or your solicitor, still need to establish the unfair relationship on the facts of your own agreement.
Which route suits your situation, if either, depends on your agreement's dates and specific facts. We'll assess this as part of reviewing your claim rather than assuming one route automatically applies.
What happens after a Tribunal decision, and when money actually arrives
Assuming the Tribunal rules in favour of the scheme, the published process is:
- Three months from the end of the implementation period for lenders to assess existing complainants and confirm whether they're owed anything, and how much
- Six months from the end of the implementation period for lenders to proactively contact customers who haven't complained yet, where they're likely to be owed something
- Six months for a contacted customer to respond if they want to join the scheme
- One month for payment once an offer is accepted
The implementation period itself only starts once the legal challenges are resolved, which won't be before the Tribunal hearing in December 2026 or February 2027, and judgment is expected some months after that. Realistically, this points to payments arriving at some point in 2027 rather than earlier, and it could be later in the year depending on how the Tribunal rules and how quickly judgment follows the hearing. We'd rather set that expectation plainly than repeat an earlier planning assumption that's since been superseded by firmer dates.
A note on other regulatory activity in this space
The FCA has been active on more than just the scheme itself. Alongside the redress process, the FCA, the Solicitors Regulation Authority, the Information Commissioner's Office and the Advertising Standards Authority have jointly targeted poor practice elsewhere in the motor finance claims industry, including misleading adverts, firms signing customers up to multiple competing representatives, and unfair exit fees when someone tries to leave an agreement. Worth knowing simply because it's part of the current landscape, and a useful reminder that you never need to pay a claims company or law firm to make a free direct complaint yourself, to your lender, if you'd rather not use a representative at all.
A note on scams
With redress firmly in the news, the FCA has warned that fraudsters may target motor finance customers directly, calling, texting or emailing to ask for personal details or bank information under the guise of processing compensation. Any genuine contact from your lender or from us will never ask you to confirm bank details out of the blue over the phone. If you're unsure whether a message is genuine, don't respond to it directly, contact your lender using the number on their official website instead.
What this means for your claim right now
Nothing changes in terms of what you need to do. If you've already registered a claim with us, it remains active and we're monitoring both the scheme's Tribunal process and the Angel litigation. If you haven't yet checked your eligibility, there's no reason to wait for either to conclude before doing that, getting your position confirmed now means we can advise on the right route as soon as there's more clarity.