About PCP Missold Ltd
PCP Missold Ltd is a claims management company (CMC), authorised and regulated by Financial Conduct Authority (FCA), FRN 1037114, to carry out claims management activities.
You do not need to use a CMC to make a complaint about mis-sold car finance; you can complain directly to your lender. If you’re not satisfied with the outcome, you can refer your case to the Financial Ombudsman Service (FOS), free of charge.
This guide explains what DCAs are, why they matter, who may be eligible for compensation, and how to take action, whether you choose to proceed via PCP Missold Ltd or by yourself.
Check how much you could be owed with our online pcp claim calculator
What is a Discretionary Commission Arrangement?
A discretionary commission arrangement is a model, now banned, but previously commonly used in motor-finance deals, such as PCP or HP, whereby the broker or dealer arranging the finance could adjust the interest rate, and therefore the monthly payments, depending on how much commission they wanted to receive.
In practice, a dealer might propose a higher rate of interest than necessary, not due to affordability or credit risk, but so the broker earns more. Consumers may have accepted such rates under the assumption that the rate was fixed or fairly determined.
Because the extra cost arose out of a conflict of interest and wasn't properly disclosed-DCAs became a regulatory priority.
In a nutshell, a DCA is an on-account/undisclosed commission structure built into the interest rate to disadvantage the consumer.
FCA Findings & Regulatory Context
- The FCA banned discretionary commission models in January 2021.
- The FCA subsequently launched a broad review into historic motor-finance commission arrangements. In October 2025, the FCA issued a consultation on an industry-wide redress scheme covering mis-sold car finance agreements between 6 April 2007 and 1 November 2024.
- Under the proposed scheme, lenders will be required to redress cases where commission was inadequately disclosed, or where a DCA or unfair commission arrangement was used.
- The regulator and independent bodies caution consumers to be aware of scams; some unauthorised firms are already targeting people claiming mis-sold car finance.
Thus, the regulatory environment strongly supports redress for affected consumers; DCAs are no longer permitted, and formal mechanisms are being set up to compensate those who suffered unfair arrangements.
Types of Hidden / Undisclosed Commission Arrangements
While DCA, meaning interest-rate uplift based on broker commission, is the most common, other problem types of commission or fee structures may amount to misselling:
Discretionary rate commission (DCA): interest rate uplift linked to the broker's commission, the most widely used model historically.
High commission (non-DCA): even if the model is not strictly “discretionary,” commissions may have been excessive, or structured in a way that inflated the cost to the consumer without proper disclosure.
Undisclosed commissions or ties: where the dealer or broker failed to properly disclose that they were receiving a commission, or failed to explain how the commission impacted the interest rate / total cost.
Failure to provide proper information/conflicts of interest: where there was a conflict of interest because the dealer/broker had a commission, but this was not clearly disclosed, or disclosure was buried or vague.
If any of the above apply, then the agreement may qualify as mis-sold-even if not labeled "DCA."
Who Is (or May Be) Eligible for a Claim
You may be eligible for a claim or compensation if:
- You entered into a regulated motor-finance agreement (e.g. PCP or HP) between 6 April 2007 and 1 November 2024.
- The agreement involved a broker or dealer (not only direct lender financing).
- There was a commission arrangement (DCA or non-DCA), especially where interest rates were higher than a standard or “retail” rate.
- The commission structure was not properly disclosed to you, or you were not told that the interest rate you were offered was tied to broker commission.
- You have, or can access, relevant documentation (finance agreement, contract, interest rate, bank statements, payment schedule), though a lack of paperwork might not automatically disqualify you, especially under the planned redress scheme.
According to recent sources, some eligible customers could stand to receive on average around £700 per agreement, though amounts will naturally vary depending on how much interest they overpaid and the level of commission charged.
Timelines & Key Dates
| Period / Date | What It Means for Claims & Eligibility |
|---|---|
| 6 April 2007 |
Start date from which regulated motor-finance agreements may be eligible for complaints/redress. |
| Up to 1 November 2024 |
Many agreements up to this date may be covered under the upcoming redress scheme. |
| January 2021 | The banned date from this point, DCAs should no longer have been used. |
| October 2025 | The FCA issued a consultation on a formal motor-finance compensation (redress) scheme. |
| Mid-2026 (expected) |
Earliest realistic window for compensation payments under the redress scheme. |
How a DCA / Mis-Sold Car Finance Claim Works
- Gather your documentation & evidence.
- Submit a formal complaint to your finance provider (lender/broker/bank).
- You must complain to the firm you were paying each month, not the dealership.
- Provide your name, agreement number, date of agreement, vehicle registration number, and why you believe the finance was mis-sold (e.g. DCA, undisclosed commission, excessive interest rate). Use a template complaint letter if available.
- You must complain to the firm you were paying each month, not the dealership.
- Await acknowledgement and response.
- Under usual rules, lenders must acknowledge within a few days (if the complaint is not resolved immediately) and must respond in writing, typically within 8 weeks.
- Because of ongoing regulatory review, deadlines may be delayed, but you should still receive an acknowledgement.
- Under usual rules, lenders must acknowledge within a few days (if the complaint is not resolved immediately) and must respond in writing, typically within 8 weeks.
- Escalate to the Financial Ombudsman Service (FOS) if needed.
- If the lender rejects your complaint, fails to reply, or gives an unsatisfactory outcome, you have the right to bring the complaint to the FOS.
- FOS handles motor-finance commission complaints and may order compensation, correction to credit files, or other redress.
- If the lender rejects your complaint, fails to reply, or gives an unsatisfactory outcome, you have the right to bring the complaint to the FOS.
- Alternatively, or additionally, you may use a Claims Management Company (CMC) such as PCP Missold Ltd.
- This means PCP Missold Ltd will act on your behalf: gather evidence, submit the complaint, liaise with the lender, and (if needed) escalate to FOS.
- Using a CMC is optional; many consumers prefer to claim themselves to avoid fees.
- This means PCP Missold Ltd will act on your behalf: gather evidence, submit the complaint, liaise with the lender, and (if needed) escalate to FOS.
- Potential outcomes/compensation.
- If your complaint is successful, you may receive compensation for the extra interest paid, and potentially other redress (depending on circumstances). Under the upcoming redress scheme, the average overpayment identified is around £700 per agreement, though values will vary.
- If you have multiple mis-sold agreements, you may claim for each separately.
- If your complaint is successful, you may receive compensation for the extra interest paid, and potentially other redress (depending on circumstances). Under the upcoming redress scheme, the average overpayment identified is around £700 per agreement, though values will vary.
See a step-by-step breakdown of how we handle claims:
https://www.pcpmissold.co.uk/how-it-works
Supporting References & Materials
- FCA consumer guidance on car finance complaints & commission issues.
- FCA consultation paper on proposed motor-finance redress scheme (Oct 2025).
- Third-party guidance (e.g. MoneyHelper) on mis-sold car finance: what to do, how to claim, and typical compensation.
- Independent guidance on how to gather evidence, submit complaints, and escalate to the Ombudsman or tribunal where necessary.
- Warnings from consumer-advice organisations about scammers and unauthorised firms preying on the mis-selling wave.
Why You Should Act, and Why the Use of a Claims Management Company Remains Optional
- The regulatory environment is rapidly changing. With the FCA consultation on a redress scheme going on, alongside widespread media and industry coverage, now is a timely moment to check your past finance agreements.
- Even if the formal compensation scheme isn't live yet, you have the right to complain directly to your finance provider, and if needed, escalate to the FOS. This route remains free.
- Because many agreements date back several years, and interest rate uplift might have had a sizeable cumulative effect, any potential compensation may be substantial, especially if you had multiple agreements.
- Using a CMC such as PCP Missold Ltd can make the process easier: they do the paperwork, chase lenders and guide you through FOS escalation if needed. But it is often costly (usually taken out of any compensation) and is not strictly necessary.
How PCP Missold Ltd Works (If You Choose to Use a CMC)
- PCP Missold Ltd can review your case, collate relevant documentation, identify whether a DCA or similar commission arrangement may have been used, and prepare a complaint on your behalf.
- They liaise with your lender or broker, keep track of the progress, and, if required, escalate to the Financial Ombudsman Service.
- They are regulated by the FCA under FRN 1037114, and you can check their regulatory status on the FCA Register.
- Because they charge a fee or take a share of any compensation need to balance that convenience and support with the possible cost.
Final Summary & Key Takeaways
- Before their ban, effective January 2021, Discretionary Commission Arrangements were widely used alongside other undisclosed/excessive commission models in motor-finance agreements.
- Many consumers who took out PCP, HP or similar agreements between 2007 and 2024 may have been overcharged because of hidden commissions built into their interest rates.
- The FCA is consulting on a formal redress scheme, and many lenders are preparing for large-scale compensation, but you don't have to wait for the scheme to act; you can complain today.
- To claim, gather your paperwork, submit a complaint to your lender, and, if the outcome is unsatisfactory, take it to the FOS. This process is free.
- If you prefer, you may use a regulated claims management company such as PCP Missold Ltd. But that is optional, and any fee will likely come out of your compensation, reducing the amount you receive.
- Given the magnitude of this issue and the number of consumers likely to be affected, it is highly recommended that you revisit your past car finance agreements, especially if you used PCP or HP and purchased a vehicle through a broker or dealer.
Frequently Asked Questions
What is a Discretionary Commission Arrangement (DCA)?
A Discretionary Commission Arrangement (DCA) is a type of car finance structure where a broker or dealer could increase the interest rate on a PCP or HP agreement to earn higher commission. This meant customers could be charged more without realising that commission was influencing their APR. Many people now check for hidden commissions using tools such as the PCP Claim Calculator.
How do I know if I was affected by hidden commission?
If your car finance was arranged through a dealership rather than directly through a bank or lender, you may have been offered a rate influenced by discretionary commission. This may apply to agreements with lenders, including
Barclays, MotoNovo / Firstrand, Close Brothers, Santander, and Lloyds Banking Group.
What are the signs of mis-sold car finance?
Signs include unclear APR, rushed explanations at the dealership, little-to-no commission disclosure, and discovering later that others with similar credit profiles received lower rates. If you want to explore the process of bringing a complaint in more depth, you can read how claims typically progress here:
https://www.pcpmissold.co.uk/how-it-works
What evidence do I need to make a complaint?
Useful documents include your finance contract, APR breakdown, payment records, and any mention of commission. If you do not have paperwork, lenders can usually provide it on request. Multiple agreements may also be claimable individually if more than one car was financed during the qualifying period. More support around evidence and next steps can be found here:
https://www.pcpmissold.co.uk/how-it-works
Do I have to use a Claims Management Company?
No. You can make a complaint yourself for free and escalate to the Financial Ombudsman Service if needed. PCP Missold Ltd can support you if you prefer someone to handle the process for you. You can learn more about the company here:
https://www.pcpmissold.co.uk/about-us
How much compensation could I receive?
Amounts vary by case. Some customers may recover hundreds or more, depending on the interest uplift caused by discretionary commission. The best starting point is to run an eligibility check using the PCP Claim Calculator
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