Billions at Stake – The “B” Word Behind Britain’s Finance Fiasco

Thousands of UK drivers could be owed significant compensation due to mis-sold car finance deals, with the unfolding scandal drawing strong parallels to the notorious Payment Protection Insurance (PPI) crisis.

Unlike previous financial controversies that targeted specific groups, this issue cuts across a broad swathe of consumers — particularly those who financed their vehicles through Personal Contract Purchase (PCP) or Hire Purchase (HP) agreements. At the heart of the scandal lies the practice of undisclosed commissions, which often inflated the cost of borrowing without the customer’s knowledge.

A key element of this controversy involves a now-outlawed system that allowed car dealers to hike up interest rates on finance deals to boost their own commissions — frequently without ever disclosing these charges to the buyer.

What exactly went wrong?

Prior to the Financial Conduct Authority’s (FCA) intervention in 2021, car dealerships routinely used what were called discretionary commission arrangements. These schemes allowed dealers to determine the interest rates on car finance deals — and they had a strong reason to push them higher: the steeper the rate, the bigger their commission.

The problem? The majority of drivers were completely unaware this practice was taking place.

No clear explanation. No disclosure of commissions. Just an agreement with higher repayments than necessary – and thousands of pounds lost over the term of the deal.

Court rulings have changed the game

Over 18,000 new complaints about car finance mis-selling were received in the last quarter of 2024 by the Financial Ombudsman Service. Lenders could be paid out in billions following a landmark ruling from the UK Supreme Court later in 2025.

Big financial houses are preparing for impact already. In addition to the £1.1 billion earmarked for possible liabilities, Lloyds Banking Group is likely to make such provisions. Industry estimates place the cost at £44 billion.

Could you be owed money?

Customers who bought their cars through a personal contract purchase or hire purchase agreement before January 28, 2021, and who were not clearly informed about dealer commissions, may be eligible for a refund. That applies even if the financing has been fully repaid or the car has since been sold. 

At Reclaim247, we help people find out what they're owed. Finding out what you might be owed is a quick, simple, and free process. With average claims around £4,000, it's well worth a few minutes of your time.

What’s happening now?

While the Financial Conduct Authority has temporarily paused complaint processing until the Supreme Court decision is handed down, that doesn’t mean you should wait.

Starting the process now means your claim will be ready to go once a ruling is made. With more people coming forward every day, it’s important not to delay.

Don’t miss out – check today

This scandal has already affected millions of people—and many more still are unaware they are owed anything.

Think you may have been overcharged? Don’t wait—Reclaim247 is ready to review your agreement and kickstart your car finance claim. The process is fast, completely free, and you could be entitled to thousands in compensation.