FCA updates on motor finance compensation scheme decision timings

The FCA has confirmed that it is still considering the responses it received to its consultation on a motor finance compensation scheme. It says that if it proceeds with the scheme, it will make changes from what it consulted on. And that, if it goes ahead, it will publish its final rules in late March, outside of market hours on a date that it will confirm in advance.

However, to help manage expectations, it is telling firms now that:

• there would be an implementation period of 3 months, with up to 5 months for older agreements, but firms could choose to start processing claims sooner;
• consumers who complained before the scheme starts would be told within 3 months of the end of the implementation period whether they are owed compensation and, if so, how much – they would not be given the chance to opt out;
• consumers who receive a redress offer could accept immediately and not have to wait for the final determination;
• firms would not have to use recorded delivery when writing to customers – other appropriate channels could be used instead.