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Motor finance: payback time?

© Copyright LexisNexis 2026. All Rights Reserved.
17 October 2025 / Fred Philpott
Issue: 8135 / Categories: Opinion , Consumer , Financial services litigation , Commercial , Transport
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Hot on the heels of the FCA’s proposed redress scheme, Fred Philpott considers the winners & losers

Following the Supreme Court’s decisions on motor finance commission, the Financial Conduct Authority (FCA) has published a proposed redress scheme. On 7 October 2025, after the markets closed (the likely financial impact of the proposals dictated this timing, as the cost to the credit business was estimated in the proposal at £11bn), the FCA published for consultation the proposed scheme for the credit businesses involved (‘Consultation paper CP25/27: Motor Finance Consumer Redress Scheme’.

Background

In Johnson v FirstRand Bank Ltd (London Branch) (trading as Motonovo Finance) and other cases [2025] UKSC 33, [2025] 3 WLR 423 (also known as Hopcraft v Close Brothers Ltd), the Supreme Court rejected allegations that motor finance commission constituted a bribe, or that there was a fiduciary relationship between the motor dealer and the credit provider. However, in the case of Johnson, it was held that there was an unfair relationship under s 140A

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