FCA publishes hire purchase agreement undertaking

The FCA has published a notice of undertaking under the Consumer Rights Act in relation to vehicle hire purchase contracts issued by Mercedes-Benz Financial Services (UK) Limited. The FCA had been concerned that an excess mileage charge in the contracts was unclear on how permitted mileage would be calculated if the contract was terminated part way through a 12 month period. It was also concerned that the firm had not interpreted the terms in a way favourable to consumers.

The firm has now agreed to make changes to its contract and to provide redress to affected customers.