FCA confirms DCA complaint handling
Car loan providers and dealerships won’t need to give a final response to customer complaints related to discretionary commission arrangements (DCAs) for more than a year while the regulator continues to tackle the issue.
The Financial Conduct Authority (FCA) has just confirmed it has extended the pause to firms’ deadline until December 4 in 2025.
Usually firms had an eight week limit within which to give their final response to motor finance customers complaints.
But since the subject of DCAs blew up earlier this year, and the FCA stepped in to review the issue after the Financial Ombudsman Service deemed firms could be liable for historic cases, the FCA introduced the pause, and now extended it, to “prevent disorderly, inconsistent and inefficient outcomes for consumers, as well as knock-on effects on firms and the market” while it continues to assess the issue.
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The FCA’s review was initially hoped to be completed this year however that has proved impossible due to delays in getting data. The FCA’s review was originally Consumers have 15 months instead of 6 months “Resolving the mass of complaints may He said one option is to allow firms to continue to process complaints in the normal way, “and that might be a route we choose for some situations”, but now that a picture of the issue is becoming clearer it is looking more likely that some kind of structured redress mechanism may be necessary.
The problem of missold payment protection insurance was resolved by a FCA-implemented compensation system, which led to regulated firms paying out millions of pounds.
He doesn’t expect the redress for the motor finance issue to be of the same scale as the PPI scandal.
