1 year ago
FCA Head: Car Finance Compensation Will Be Less Than PPI
The head of the UK's Financial Conduct Authority (FCA) said that banks will likely pay out much less money to fix the car loan issue than they did for the old Payment Protection Insurance (PPI) scandal.
This comes after the highest court in the UK made a decision that helps the banks.
The FCA is figuring out if there should be a plan to give money back to people.
The old PPI issue cost banks a lot of money.
The FCA will let everyone know what it is doing on Monday.
FCA expects car finance compensation to be substantially less than the PPI scandal.
Nikhil Rathi, FCA CEO, made the statement in an interview with the Sunday Times.
The Supreme Court ruling reduced the potential compensation for mis-sold car finance.
PPI compensation cost banks at least £35 billion.
The FCA will announce its decision on a redress scheme before markets open Monday.
- Who
- Nikhil Rathi (FCA CEO), consumers and lenders in the UK car finance market.
- What
- FCA expects lower car finance compensation compared to PPI.
- Where
- UK.
- When
- The announcement was made on Sunday.
- Why
- To clarify the financial impact of the recent Supreme Court ruling.
Consumer Perspective
Lender Perspective
Compensation
Consumer Perspective
Consumers who were mis-sold car finance may be owed money.
Lender Perspective
Lenders and dealers may have to pay fines if they are not compliant with the rules.
Key facts
- Authority
- Financial Conduct Authority (FCA)
- CEO
- Nikhil Rathi
- Issue
- Car Finance Compensation
- Previous Scandal
- Payment Protection Insurance (PPI)
- PPI Cost
- At least £35 billion
- Redress Scheme Announcement
- Before markets open on Monday
