Context
The FCA has also written to lenders and brokers (PDF) with its expectations of actions firms should take now. The FCA letter points out that it is crucial lenders and brokers do not wait for the outcome of the consultation and prepare now to deal with their existing portfolio of complaints and a potential redress scheme. The FCA states it will support lenders and brokers as they prepare and will take a pragmatic and proportionate approach. However, if any firms are seen failing to prepare appropriately, the FCA says it will intervene using its supervisory and, if necessary, enforcement powers.
Key points to note and next actions
Existing leasing complaints: In chapter 11 of the Consultation, the FCA outlines it is not proposing to extend complaint handling times for leasing agreements beyond 4 December 2025. Firms need to provide feedback on this aspect of the Consultation, by 4 November 2025. The FCA expects lenders and brokers to use this period to ensure they can start delivering timely, accurate and fair outcomes to leasing agreement complaints from 5 December 2025.
Other existing complaints: With the exception of leasing complaints, the FCA is proposing to further extend the time for firms to send final responses about motor finance commission complaints until 31 July 2026
Firms:
• Should, where possible, continue to collect evidence that could help with the eventual resolution of the complaint. FCA proposals do not affect the continuing application of DISP 1.4.1R. This rule requires firms to, among other things, assess and investigate complaints properly and diligently; and
• Must progress complaints including issues that would fall outside the scope of any scheme, for example affordability, forbearance or other aspects of lending and broking in accordance with existing complaint handling rules under DISP.
Under FCA proposals, Lenders will also be responsible for resolving claims within any scheme and much of the letter focuses on the FCA’s expectations of Lenders. Brokers will play a key role in supporting Lenders by helping to address any information gaps in Lenders’ records. The FCA expects Lenders to deliver the following actions under the proposed scheme:
(i) Take reasonable steps to accurately identify and effectively contact impacted consumers (with support from third parties such as brokers and credit reference agencies where required).
(ii) Gather appropriate information to determine whether cases are in scope of the scheme and, where they are, to assess liability (with support from brokers where required) and reach appropriate decisions.
(iii) Ensure redress calculations are accurate, and payments are made quickly by lenders.
(iv) Ensure there is no undue delay at any stage of the proposed redress scheme.
(v) Where issues are identified, ensure they are remedied swiftly and robustly.