Barclays’ finance arm Barclays Partner Finance announced that it will offer early pay-outs to some motorists who were mis-sold car finance
Barclays has issued an update(Image: Getty)
Barclays has announced it will offer early pay-outs to some motorists who were mis-sold car finance. In 2024 the Financial Conduct Authority [FCA] deemed that since 2007 many motor finance lenders hadn’t been ‘properly telling customers important agreement information’.
This year they launched a redress scheme estimated to give £9 million in compensation to around 14 million people impacted, but a legal challenge means a judgment isn’t expected until next year. Barclays’ finance arm Barclays Partner Finance announced this week that some customers won’t need to wait until proceedings are over.
They say those whose complaints were acknowledged on or before October 1 this year will receive an early settlement offer. The firm add that the offer will be calculated using the FCA’s redress scheme methodology to “reflect individual circumstances of each agreement”.
Barclays confirmed customers or their representatives will be contacted “in the coming weeks” but that this acceptance is optional. It’s outlined that they will be told how the offer has been calculated and then given a month to accept or reject the offer.
They say this timing means offers can be processed and paid before the legal challenge in February. It’s warned that accepting the offer means customers can’t seek additional compensation in future but that Barclays will not ask for them to repay the settlement if the final outcome would have been less.
Those who reject or don’t respond to the offer are told they will be provided with information following the legal challenge’s conclusion but they may be entitled to a larger, smaller or no offer at that time. The challenge is due to be heard between February 16 2027 and March 3 2027 and a result expected in the following months.
A Barclays Partner Finance spokesperson said: “We recognise that some customers have already faced a considerable wait for an outcome of their motor finance complaints. By making these early settlement offers, we are giving some customers the option of receiving redress sooner, rather than waiting for the legal challenges and any subsequent FCA action to conclude.
“Each offer will be calculated using the FCA’s own redress scheme methodology. We will clearly explain how it has been calculated and what accepting a full and final settlement means, so customers can decide whether accepting the offer is right for them.”
