The Financial Conduct Authority (FCA) said on Tuesday that lenders may make early car finance settlement offers that pay no less than its scheme, after 89% of surveyed complainants said they want the choice now.
The regulator said 89% of motor finance customers who have complained or are considering it want an offer now rather than waiting for legal challenges to the scheme to end.
Of those, 86% would be comfortable making the decision and 61% would accept an offer in line with the scheme.
Stephen Braviner Roman, the FCA’s general counsel and co-lead on the motor finance project, said: “Fair settlement offers could result in some people getting money sooner. And it’s clear they want the choice.”
The FCA also said 77% of respondents think sooner compensation would make a great deal or fair amount of difference to their finances.
The findings come from a Kantar online survey of 1,000 motor finance customers on 25 to 28 June 2026, with the cited results based on 590 who had complained or were considering it.
The FCA said Barclays Partner Finance has confirmed it will make settlement offers to some of its customers owed compensation. It added that not all lenders are likely to do so, and those that do may offer only to some customers.
Acceptance is “full and final”, meaning the matter is closed on both sides. Customers keep any money paid even if the outcome of the legal challenges would have given them less.
They also cannot claim more later if the outcome would have paid more. The FCA’s customer guidance says the lender cannot ask for money back.
Offers cannot be referred to the Financial Ombudsman Service, because customers can reject an offer and leave the claim to be dealt with under the scheme. The guidance adds that accepting could also affect the ability to bring the matter to court.
Lenders may also offer only the remainder after “set-off”, which means deducting payments still owed on the car loan.
Roman said: “Anyone who wants to wait can, and there’s no obligation to agree to the offer. We’ll closely monitor firms making offers and expect them to be clear what accepting an offer means.”
In its minimum expectations for firms, the FCA says customers should get at least one month to respond. Letters must state that the offer is at least equal to the maximum redress available under the scheme.
Letters must also make clear that the FCA has not reviewed the terms of any individual offer, and must not suggest it has approved them.
They must explain what a full and final settlement means in practice, including that the existing complaint will ordinarily be treated as withdrawn.
Lenders must share an FCA factsheet with each offer, and are expected to tell the regulator if they plan to make offers. The FCA said it will regularly update its website with lenders making offers so customers can check an offer is genuine.
The scheme was launched in March 2026 and challenged by Volkswagen Financial Services, Mercedes Benz Financial Services, Crédit Agricole Auto Finance and Consumer Voice. The Upper Tribunal suspended parts of it on 2 July 2026.
Under the partial suspension, firms need not calculate or pay compensation until the legal process ends. The challenges are due to be heard between 16 February and 3 March 2027.
The FCA’s guidance says payments could begin in 2027 if the scheme is upheld and not appealed, but could slip to 2028 or later if it is appealed or overturned.
The regulator estimated at launch that 12.1m agreements are eligible, with average payouts of around £830.
Claims management companies and law firms may charge up to 36% of any compensation, including VAT, and the FCA said there is no need to use one.
