Motor Finance Redress: Why ‘Ready’ Might Not Mean Resilient
With the Supreme Court’s ruling on discretionary commission arrangements (DCAs) imminent, many motor finance firms are entering what could be their 'PPI moment'. And while most are already well into their preparation cycle, if not nearing the end, a bigger challenge is quietly approaching.
The pace may feel manageable for now, but the complexity coming around the corner will test just how prepared firms are. And the toughest lessons often don’t arrive until your inbox is already full.
It’s not just about planning, it’s about holding up under pressure.
The FCA has made its expectations clear: firms must understand the scope and impact of their past practices. Most have already laid strong foundations by mapping systems, identifying key cohorts, and building high-level views of exposure. That groundwork matters, and it’s exactly what makes now the right moment to look deeper.
But redress isn’t defined by planning alone; it’s defined by what happens when the plan meets reality. Even with solid groundwork in place, most redress programmes are ultimately shaped by what they didn’t see coming. The hidden gaps, unexpected edge cases, and operational drag that only emerge once delivery begins.
Three challenges that stay hidden until they cost you.
1. Data gaps that don’t surface until they stall delivery
Some records will be archived, others will be corrupted, held by third parties, or require SME knowledge that’s no longer in the business. The issue isn’t knowing that in theory, it’s discovering it midstream, under pressure, when time and trust are already in play.
Action: Go beyond mapping and profile your data now. Where gaps can’t be filled, define evidence-backed workarounds early, before they become public problems.
2. Cohort complexity that outpaces your logic
What begins as ten clean customer groups will soon fracture into hundreds of treatment paths, joint borrowers, address mismatches, in-arrears accounts, deceased estates, guarantors, and manual overrides. These aren’t outliers; they’re structural features of your portfolio.
Action: Test your operational logic at a cohort level, building for variation and assurance, not just the happy path. The faster you can spot divergence, the fewer rework loops you’ll face.
3. Operational friction that compounds data risk
Even with sound logic and good systems, delivery will falter if the rest of the operation can’t keep pace, especially across complaints handling, FOS response, tranche deployment, and internal traceability. Inconsistencies between data and ops are among the most expensive errors in redress history.
Action: Don’t just plan capacity, model volatility by stress-testing how your data layer supports operational reality. What matters isn’t just throughput, but consistency under strain.
Why it matters: Most firms don’t just pay twice - they pay several times over.
Historically, FS providers rarely pay only what they first forecast. In fact, in many programmes, the eventual cost ends up three, five, even ten times higher than initial estimates.
This is not just due to the redress itself, but because data gaps, system fragility, and untested assumptions create failure points that compound during delivery. These aren’t rare failures; they’re the product of well-intentioned programmes that didn’t adjust fast enough when the plan hit its first exception.
Conclusion: Redress is a data programme disguised as a delivery problem.
Motor finance firms still have a window – but it’s narrowing. Early preparation isn’t just about surfacing what you already know; it’s about pressure-testing the unknowns and equipping your teams to adapt to them in flight.
The FCA won’t expect perfection, but it will expect fairness, traceability, and credibility. Not just in the first pass, but in every decision that follows, and when the complexity starts to surface, resilience is the only thing that will see you through.
Fenway Data Group: https://linkedin.com/company/fenway-data-group
Adrian Ward: https://linkedin.com/in/adriangward
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James Challinor
Head of Financial Services, techUK
James leads our financial services programme of activity. He works closely with member firms from across the sector to ensure innovation and technology are fully harnessed and embraced by both industry and regulators.
Prior to joining us James worked at other business organisations including TheCityUK and the Confederation of British Industry (CBI) in roles focused on supporting the financial & related professional services eco-system, with a particular focus on financial technology and market infrastructure.
He holds degrees from King's College London and Oxford Brookes University, and outside of work enjoys socialising, exercising, and travelling to new locations.
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Adrian Ward
Data Leader, CTO, Fenway Data Group
