Banks could be forced to proactively tell customers they have been mis-sold car finance, as the financial watchdog’s plans for a compensation scheme affecting potentially millions of Britons moved “one step closer”.
The Financial Conduct Authority (FCA) said on Tuesday it would announce its decision on such a scheme – which could result in redress totalling billions of pounds – within six weeks of a decision following a landmark supreme court hearing early next month.
It is the latest development in the ballooning scandal surrounding the alleged large-scale mis-selling of car loans.
If the scheme floated by the FCA goes ahead, lenders are likely to have to proactively contact all borrowers who meet the mis-selling criteria and offer compensation – freeing up individuals from the need to submit a complaint and dealing a blow to claims management firms. Payouts could typically average just over £1,100 a person, according to one estimate.
The website MoneySavingExpert.com said that payouts for mis-sold car finance were “one step closer” after the FCA announcement….
