Discretionary Commission Arrangements - Complaints and Refunds

You do not need to use a Claims Management Company. You can make the claim directly to the lender and if they reject your complaint you can take it to the Financial Ombudsman Service free of charge, but you must do this within 6 months of the lenders Final Decision Letter.

Discretionary Commission Arrangements

Complaints and Refunds

Hello and welcome to Redbridge Finance. We are a UK located Claims Management Company that specialises in making complaints and claims against UK lenders for mis-sold loans. Discretionary Commission complaints are growing rapidly since the FCA and the FOS conducted an investigation and found in favour of the comsumer. We have extensive experience across many years making complaints and winning refunds and compensation for our customers.

We are pretty good at what we do and our customers agree. We score 4.9 on Google Reviews with the only negative reviews from debtors who tried to avoid paying our fees.

We would love to try and help you get a refund for an unfair loan and if this is something you wish to do, please click the button above so we can start the process.

The process is slow and will take many months, but we will do most of the work and keep you updated as the process progresses.

Below you can read more about Discretionary Commission Arrangements.

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Discretionary Commission Arrangements (DCAs): The Hidden Cost of Car Finance

Discretionary Commission Arrangements (DCAs) were a controversial practice within the UK motor finance industry that allowed car dealerships and brokers to influence the interest rate on a customer's car finance agreement. This lack of transparency often resulted in consumers paying more for their car finance than necessary. Although DCAs were banned by the Financial Conduct Authority (FCA) in January 2021, their legacy continues to impact the industry and consumers alike.

How DCAs Worked:

Under a DCA, the car dealership or broker had the flexibility to set or adjust the interest rate on a car finance agreement. The higher the interest rate they offered to the customer, the higher the commission they received from the lender. This created a conflict of interest where dealers were incentivized to prioritize their own financial gain over securing the best deal for the customer.

Why DCAs Were Controversial:

Lack of Transparency: Customers were often unaware that the interest rate on their finance agreement was influenced by the dealer's commission. This lack of transparency meant customers might not have been getting the best possible deal.
Potential for Overcharging: Dealerships were motivated to mark up interest rates to maximize their commission, potentially leading to customers paying more than necessary for their car finance.
Unfair Outcomes: Customers could end up with higher monthly payments and a larger total cost of credit without realizing it was partly due to the dealer's commission.
Breach of Trust: DCAs undermined the trust between customers and dealerships, as the customer's best interests might not have been the primary motivator for the dealer.

Motor Lenders That Used DCAs:

Many major motor finance lenders in the UK utilized DCAs before the FCA ban. Here are some of the prominent lenders that have acknowledged using this practice:

Barclays Partner Finance:
Black Horse Finance: https://www.blackhorse.co.uk/
Close Brothers Motor Finance: https://www.closemotorfinance.co.uk/
Moneyway: https://www.moneyway.co.uk/
Santander Consumer Finance: https://www.santanderconsumer.co.uk/
Advantage Finance: https://www.advantagefinance.co.uk/
First Response Finance: https://www.firstresponsefinance.co.uk/
MotoNovo Finance: https://www.motonovo.com/

Why Lenders Used DCAs:

Lenders used DCAs primarily because they incentivized dealerships to sell their finance products. By giving dealers the flexibility to set interest rates and earn higher commissions, lenders could increase their sales volume and market share. However, this practice came at the expense of transparency and consumer fairness.

The FCA's Intervention and Ongoing Impact:

The FCA banned DCAs in 2021 to address the concerns about transparency, fairness, and potential consumer detriment. The ban aims to:

Increase Transparency: Ensure customers are fully informed about the costs of car finance and how commissions are earned.
Promote Fairer Pricing: Prevent dealerships from inflating interest rates for their own gain.
Restore Trust: Rebuild confidence in the motor finance industry by ensuring customers are treated fairly.

Despite the ban, the legacy of DCAs continues to impact the motor finance industry. The FCA is currently conducting a review into the historical use of DCAs and their impact on consumers. This could lead to further regulatory action and potential redress for customers who were overcharged.

References:

FCA's Finalised Guidance on DCAs: https://www.fca.org.uk/publication/finalised-guidance/fg21-1.pdf
FCA's webpage on car finance complaints: https://www.fca.org.uk/consumers/car-finance-complaints
Competition & Markets Authority's (CMA) report on motor finance:

Conclusion:

Discretionary Commission Arrangements were a controversial practice that allowed car dealerships to prioritize their own financial gain over the best interests of their customers. The FCA's ban aims to create a fairer and more transparent motor finance market. Consumers who believe they were overcharged due to a DCA should contact their lender or the Financial Ombudsman Service to explore options for redress.

Car Finance Companies and Their Websites:

Admiral: https://www.admiral.com/loans/car-finance/car-loans - Admiral has stated they did not use DCAs.
Advantage Finance: https://www.advantage-finance.co.uk/ - Advantage has acknowledged using DCAs in the past and is working with the FCA.
Autolend: https://www.autolend.co.uk/ - No specific information found on their DCA usage.
Auto Money: [invalid URL removed] - No specific information found on their DCA usage.
Billing Finance: https://www.billingfinance.co.uk/ - Billing Finance has stated they did not use DCAs.
Burnley Savings & Loans: https://www.burnleysavingsandloans.co.uk/ - Burnley Savings & Loans has stated they did not use DCAs.
Car Loan Centre: [invalid URL removed] - No specific information found on their DCA usage.
Carmoola: https://www.carmoola.co.uk/ - Carmoola has stated they did not use DCAs.
First Response Finance: https://www.firstresponsefinance.co.uk/ - First Response has confirmed using DCAs and is committed to redress.
Glenside Finance: [invalid URL removed] - No specific information found on their DCA usage.
Guardian Finance: [invalid URL removed] - No specific information found on their DCA usage.
Lendable: https://www.lendable.co.uk/ - Lendable has stated they did not use DCAs.
Mallard Finance: [invalid URL removed] - No specific information found on their DCA usage.
MoneyBarn: https://www.moneybarn.com/ - Moneybarn has faced scrutiny and regulatory action over its past practices, which may have included DCAs.
Oodle Car Finance: https://www.oodlecarfinance.com/ - Oodle has stated they did not use DCAs.
Oplo: [invalid URL removed] - Oplo has stated they did not use DCAs.
Premium Plan: [invalid URL removed] - No specific information found on their DCA usage.
RateSetter: https://www.ratesetter.com/ - RateSetter has stated they did not use DCAs.
Retail Money Market: [invalid URL removed] - No specific information found on their DCA usage.
Specialist Motor Finance: [invalid URL removed] - No specific information found on their DCA usage.
Tandem: https://www.tandem.co.uk/ - Tandem has stated they did not use DCAs.
Vehicle Credit: [invalid URL removed] - No specific information found on their DCA usage.
1st Stop Finance: https://www.1ststopfinance.co.uk/ - 1st Stop Finance has stated they did not use DCAs.

Important Notes:

FCA Review: The FCA is conducting an ongoing review of the historical use of DCAs. This may lead to further information becoming available about which lenders used them and the potential impact on customers.
Complaint Process: If you believe you were impacted by a DCA, you can complain to the lender directly or escalate your complaint to the Financial Ombudsman Service (FOS).
This List Is Not Exhaustive: It's possible that other lenders not listed here also used DCAs. If you have concerns about a specific lender, it's best to contact them directly or check the FCA website for further information.

Mis-sold Car Finance? Claim Compensation with Redbridge Finance

Has your car finance agreement left you feeling cheated?

You're not alone. Mis-selling of car finance, including PCP (Personal Contract Purchase) agreements, is a widespread problem in the UK. The Financial Conduct Authority (FCA) has found evidence of irresponsible lending across the industry, with many customers facing unfair practices and hidden fees.

Were you a victim of these unethical tactics?

Unrealistic affordability checks: Did your lender truly assess whether you could afford the repayments?
Manipulated interest rates: Were you charged a higher interest rate than necessary, boosting the dealer's commission?
Hidden fees and charges: Were there unexpected costs buried in the small print?

If you suspect you were mis-sold car finance, you could be entitled to a refund and compensation.

Redbridge Finance is here to help.

We specialize in helping people claim compensation for mis-sold car finance. Our experienced team will guide you through every step of the process, ensuring you understand your rights and receive the maximum compensation you deserve.

Why choose Redbridge Finance?

No Win, No Fee: You only pay if we win your case.
Hassle-free claims process: We handle everything, so you can focus on other things.
Expert guidance: Our team has in-depth knowledge of car finance regulations and claims procedures.
Strong track record: We have a proven history of success in securing compensation for our clients.

Don't wait any longer. Get a free claim assessment today.

Contact Redbridge Finance now and find out if you're eligible for a car finance refund. We're here to fight for your rights and get you the justice you deserve.

Important Documents

Illustration of Fees

Fees charged by Redbridge Finance will be capped as per the table below. Further examples are shown below the table.

The figures quoted are only calculated on actual money sent to you. If you get a balance reduction, we do not charge any fees on the balance reduction element, just on money sent to you by the lender.

Band	Redress awarded for a claim (£)	The maximum percentage rate of charge	The maximum total charge (£)
1	£1-£1,499	30% plus vat	£420
2	£1,500 - £9,999	28% plus vat	£2,500
3	£10,000-£24,999	25% plus vat	£5,000
4	25,000-£49,999	20% plus vat	£7,500
5	£50,000 or above	15% plus vat	£10,000

These are some examples:

Band 1

Compensation amount £1,000. Our Fee £300 + VAT (£360 inc VAT). You get £640

Compensation amount £1,499. Our Fee £350 + VAT (£420 inc VAT). You get £1,079

Band 2

Compensation amount £5,000. Our Fee £1,400 + VAT (£1,680 inc VAT). You get £3,320

Compensation amount £9,999. Our Fee £2,083.33 + VAT (£2,500 inc VAT). You get £7,499

Band 3

Compensation amount £15,000. Our Fee £3,750 + VAT (£4,500 inc VAT). You get £10,500

Compensation amount £24,999. Our Fee £4,166.67 + VAT (£5,000 inc VAT). You get £19,999

Band 4

Compensation amount £30,000. Our Fee £6,000 + VAT (£7,200 inc VAT). You get £22,800

Compensation amount £49,999. Our Fee £6,250 + VAT (£7,500 inc VAT). You get £42,499

Band 5

Compensation amount £50,000. Our Fee £7,500 + VAT (£9,000 inc VAT). You get £41,000