The redress reckoning: Why UK banks must act on motor finance remediation - Version 1

Something big is coming to the UK retail banking system.

For anyone paying attention, the motor finance redress storm has been gathering pace for some time, so much so that it could even mirror the fallout we saw with payment protection insurance (PPI).

A recent Court of Appeal ruling on discretionary commission arrangements (DCAs) has triggered a flood of complaints and scrutiny, which could result in a significant £40 billion price tag for banks. (The Guardian, March 2025)

However, this is not just about the potential financial impact. It’s about trust, and whether your organisation is ready to respond when the pressure is increased. But this is where we can help.

In this post, we‘ll provide recommendations to get ahead of the issues and prevent your organisation from becoming the next cautionary tale.

The challenge you’re facing: volume, visibility, and vulnerability

Imagine being told to trace every customer, every product, every commission decision you’ve made over the last two decades and then prove that it was all fair, accurate, and well-documented. This is the position many banks are in right now. We’ve spoken with numerous teams who are uncovering some uncomfortable truths, including:

Data that’s patchy, fragmented, and just not fit for purpose

Systems that were never designed to look backwards this far or this deeply

Customer records missing key information

Teams already over-stretched, now expected to manage a full-blown remediation programme

If this sounds overwhelming, that’s because it is.

What happens if you get it wrong?

This is not just a regulatory headache, it’s a full-spectrum risk event, and the consequences are significant.

Regulatory trouble

The FCA is watching closely. If you alter the process or miss the mark, expect enforcement actions or even a ‘Skilled Person’ review.

Customer fallout

People will be angry if you delay payments, undercompensate them, or send confusing letters. Once the trust is lost, it’s hard to win back.

Operational chaos

If your remediation programme is not tightly scoped and managed, you’ll waste time, money, and resources you cannot afford to lose.

The good news is that there is still time to take control of the narrative.

Here’s what you should be asking yourself right now

Instead of waiting for these challenges to start escalating, ask yourself the following questions:

Do you actually trust the accuracy quality of your “golden source” data and can you prove its accuracy?
Have you revisited how you handled commissions in the past based on new compliance interpretations?
Can you reliably segment and prioritise the affected customers?
Are you prepared to explain everything clearly and compassionately to customers?
Most critically: would you be proud of the way you are remediating customers rectifying your mistakes, if the FCA asked?

These are not just checkboxes – they are your roadmap to getting this right the first time.

The policy landscape: your window of opportunity

It is worth remembering that this crisis is unfolding against a political backdrop that wants efficiency. The UK Government is pushing to reduce regulatory burden, and while that doesn’t mean a free pass, it does mean there’s an appetite to avoid another drawn-out PPI saga. However, efficiency depends on execution.

If you can prove that your remediation programme is clear, consistent, and credible from Day One, you might just avoid the worst of the scrutiny. Otherwise, you could be looking at years of investigation, escalating costs, and headlines you do not want to read.

How we can help

We have a proven history of leading complex remediation programs, and we understand what is required to achieve success.

We have the tools to clean up disorganised data: discovery, lineage, and metadata analysis to precisely identify your real ‘golden source.’

Our remediation experts and pre-built accelerators enable you to scale without overburdening your core operations.

Our Master Data Repository and custom tools provide accurate segmentation and redress calculations.

We’ll help you deliver audit-ready reports and clear, empathetic communication at every step to reassure regulators and customers alike.

In short: we turn reactive chaos into strategic control.

Final thought: Are you ready?

If you are still wondering whether you really need to act right now, consider this:

Redress is not just a compliance exercise. It’s your chance to demonstrate to your customers and regulators who you are. The banks that move early, act wisely, and communicate clearly, will come out stronger on the other side.

So, ask yourself: If the call came in tomorrow, would you be ready?

If you are unsure and need help outlining your first steps, contact us today to register for your complimentary remediation readiness assessment.