Latest news with #payouts
The Guardian
04-08-2025
- Automotive
- The Guardian
Who will get a car loan scheme payout and how much might they receive?
Millions of people are in line for payouts after the City regulator announced on Sunday that it would launch a compensation scheme for people affected by the car finance scandal. Here we explain who might be eligible, how much they might receive and what they need to do. On Friday the supreme court largely overturned last October's court of appeal ruling on car finance that could have led to compensation payouts of up to £44bn. The Financial Conduct Authority (FCA) set out its plans for a redress scheme 48 hours later, saying it would consult on a scheme covering loans dating back to 2007, with estimates putting the total cost to lenders at between £9bn and £18bn. It's partly because the FCA has been running its own investigation into so-called discretionary commission arrangements (DCAs), a particularly controversial type of car finance. With these deals, motor finance lenders – typically banks – gave dealers the power to set interest rates on car loans, with dealers getting more commission the higher the interest rate. This practice, which allegedly incentivised dealers to overcharge customers, was banned by the FCA in 2021. Given the regulator's concern, it was always likely that many DCA cases were going to be in line for compensation; about 14.6m contracts included this arrangement between 2007 and 2020. The FCA is proposing that the compensation scheme covers DCAs 'if they were not properly disclosed', – believed to be the case for the vast majority of the loans. However, the supreme court also upheld one of the three test cases on Friday – not a DCA one – deeming it 'unfair'. This was due to the size of the commission paid to the car dealer – a particularly large 55% of the total cost of the credit (in other words, the interest and fees) – and a failure to explain the structure of the deal clearly enough in documents provided to the customer. The FCA said that that court decision 'makes clear that non-disclosure of other facts relating to the commission can make the relationship unfair'. Many people, therefore, who signed car finance deals between 2007 and 2024 whose agreement did not include a DCA may still be in line for a payout if there are unfair elements. However, this potential payout will depend on the facts of each case. Clearly a large commission could be a factor, and others will be how financially literate the borrower was when they signed the contract, and how much information was provided to them. The regulator will start consulting on the scheme by early October. The consultation is due to take six weeks and the FCA aims to finalise the scheme 'in time for people to start receiving compensation next year'. People who have already complained do not need to do anything as they should be 'in the system'. For the rest, the FCA says: 'Consumers concerned they were not told about commission and who think they may have paid too much for the finance should complain now.' The MoneySavingExpert website has free tools that create an email for you to send to the relevant lender based on your answers to a few key questions. Or you can complain yourself. It is free and simple, the FCA says. You will need to complain to the company you were paying each month, and ideally do it in writing. Complaining now gives the company concerned a chance to track down your information, and if there is a problem it is probably better to know now rather than later. The short answer? No. Claims management companies and consumer law firms have been touting for business for some time, and appear to be ramping up their efforts to encourage people who may have lost out to sign up. But the FCA and Solicitors Regulation Authority (SRA) are concerned that some firms are not telling consumers about free alternatives, are making bold and sometimes misleading claims about payouts, and are charging fees worth up to 30% of any compensation. Nikhil Rathi, chief executive of the FCA, said: 'Our aim is a compensation scheme that's fair and easy to participate in, so there's no need to use a claims management company or law firm. If you do, it will cost you a significant chunk of any money you get.' The FCA estimates 'most individuals will probably receive less than £950 in compensation'. It has previously said that in the case of loan agreements that included a DCA, consumers may have been overcharged by £1,100, as a result of paying too much interest on a typical £10,000, four-year car finance deal. Some claims law firms have said some clients were charged much more, amounting to several thousand pounds in hidden commission. Also, because the FCA thinks that the scheme should cover agreements dating back to 2007, there will be people who bought several cars during this period, who may be entitled to multiple payouts. However, the FCA has indicated that it would need to balance the interests of consumers, firms and the broader economy when setting up a scheme. Presumably, that may mean people might not get back all of their 'loss'. That said, any amount people get is likely to be boosted by interest, which could add up to a reasonable amount if it is several years' worth. The FCA said it planned to consult on an interest rate for each year of the scheme based on the average Bank of England base rate that year, plus 1%. 'This would be in the ballpark of a simple [ie, not compound] interest rate of 3% per annum,' it said. Yes, this is a concern, as it is thought that most banks typically purge customer data after six years. The FCA ordered firms to stop deleting car finance documents when it launched its initial investigation in January last year. But the files relating to customers with contracts that ended more than six years earlier may have already been lost. The Financing and Leasing Association, which represents leading car loan providers, said: 'We have concerns about whether it is possible to have a fair redress scheme that goes back to 2007 when firms have not been required to hold such dated information, and the evidence base will be patchy at best. We will be interested to see how the FCA addresses this point in its consultation.' However, many people will have kept their paperwork. During the payment protection insurance (PPI) scandal, banks were urged to err on the side of consumers, even when there was no documentation, but it is not yet clear if this will happen with car loans.
Yahoo
03-08-2025
- Automotive
- Yahoo
FCA considering compensation scheme over car finance scandal - raising hopes of payouts for motorists
Thousands of motorists who bought cars on finance before 2021 could be set for payouts as the Financial Conduct Authority (FCA) has said it will consult on a compensation scheme.
Yahoo
21-07-2025
- Politics
- Yahoo
Ethics Commission launched and ministerial exit pay tightened in standards drive
Eligibility for the payouts given to ministers once they leave office will be tightened to prevent those who serve for only a matter of months from receiving them, the Government has announced. The move is part of an overhaul aimed at restoring trust in standards in public life, which will see the launch of a new Ethics and Integrity Commission. The commission, created from the Committee on Standards in Public Life, will have a wider, stronger remit to oversee integrity across every part of the public sector. Ministers will also scrap the Advisory Committee for Business Appointments (Acoba) as part of the shake-up. Critics have said the watchdog – which assesses the jobs ex-ministers take after leaving government for conflicts of interest – is toothless and unable to enforce its rules properly. Pat McFadden, the senior Cabinet Office minister overseeing the reforms, said: 'This overhaul will mean there are stronger rules, fewer quangos and clearer lines of accountability. 'The Committee on Standards in Public Life has played an important role in the past three decades. These changes give it a new mandate for the future.' The Chancellor of the Duchy of Lancaster added: 'But whatever the institutional landscape, the public will in the end judge politicians and Government by how they do their jobs and how they fulfil the principles of public service.' Ministers are currently entitled to a severance payment equivalent to three months' salary when they leave office for any reason, and no matter how long they have been in the job. Under the changes being announced by the Government, ministers who leave office after a serious breach of the ministerial code or who have served less than six months will not get the payment. If they return to office within three months of leaving, they will also not receive their salary until the end of that three-month period. The reforms are aimed at preventing situations like that under the Boris Johnson and Liz Truss governments, which saw some Conservative ministers who served for little more than a month receive payouts of thousands of pounds. Labour has said some £253,720 was paid out to 35 outgoing Tory ministers who were in post for less than six months during 2022, some of whom were in their jobs for 37 days. The new Ethics and Integrity Commission would be required to report annually to the prime minister on the health of the standards system. It would be chaired by Doug Chalmers, a retired lieutenant general who chairs the current Standards Committee. The committee was set up in 1994 by then-prime minister Sir John Major, after his government was mired in accusations of 'sleaze' following a series of parliamentary scandals. Sir John warned in a recent speech that a small group of politicians were increasingly breaking the rules, and suggested Acoba needed to be reformed. Ministers have instead decided to scrap it and split its functions between the Civil Service Commission and the Prime Minister's Independent Adviser on Ministerial Standards. Under reforms to the business appointments rules, ex-ministers found to have breached them by taking on inappropriate jobs will now be asked to repay any severance pay they receive.
Finextra
11-07-2025
- Business
- Finextra
Runa launches white label offering for gift card marketplace deployment
As global demand for gift cards surges, Runa, the leading global infrastructure powering modern payouts, today unveiled Runa Shop, a white-label commerce solution that makes launching gift card marketplaces fast and simple. 0 In only 24 hours, businesses can leverage Runa Shop to launch a fully-branded, modern gift card marketplace built to scale—no coding required. Featuring more than 5,000 popular merchant options, Runa Shop offers multiple use cases spanning from building customer and employee engagement to boosting sales and revenue. 'Most gift card storefront solutions are riddled with an abundance of inconvenient and inefficient pain points–taking months to stand up, requiring businesses to jump through hoops to make adjustments, and presenting lackluster user experiences that still result in sub-optimal conversion rates,' said Aron Alexander, Founder and CEO, Runa. 'We broke the retrofitted, outdated mold and specifically built infrastructure that transforms how quickly businesses can go live with revenue-ready storefronts. Our partners can bypass legacy challenges by self-managing and adapting their marketplaces with minimal friction and maximum speed—no coding or waiting required. And we take on the expensive program risks like compliance, liability, and payment processing so they don't have to.' For incentive, rewards and cashback programs building or refreshing their storefronts, Runa Shop drives conversions with real-time cashback and intelligent marketing capabilities. Serving as a modern engine that boosts customer engagement, loyalty and satisfaction, Runa Shop provides smoother user experiences while unlocking new revenue opportunities and converting traffic to sales almost instantly. Businesses can also tap Runa Shop to transform and strengthen employee relationships through rewards that resonate and increase engagement. Runa Shop also creates a direct revenue stream for brands selling their own gift cards. Additional key features made possible through Runa Shop include: Mobile-optimized storefronts for easy, on-the-go purchases. Customers can shop anytime, anywhere, with zero friction. Purchases may include multiple cards and denominations in a single, smooth transaction. Hassle-free payments. Runa Shop offers this seamless checkout on a global scale via payment options such as credit, debit, PayPal, Apple Pay and Google Pay. Currency support is available in USD, GBP, EUR, CAD, and more. Personalized and expansive shopping experiences. Runa Shop puts the right gift in the right hands through intelligent, cart suggestions that inspire last minute add-ons. These tailored add-on suggestions turn passive browsing into action—driving basket value and higher revenue. Customizable product categories make it easy for each user to explore, discover and purchase gift cards that matter to them. Promotions that perform. Through data-informed retargeting at checkout, Runa Shop intelligently predicts customer behavior to boost conversions through targeted marketing campaigns. With access to real-time performance insights, businesses can ensure marketplaces are optimized and competitive. 'Partnering with Runa to build our white-label gift card marketplace has been a game changer,' said Natalia Selezneva, Product Manager, TopCashBack US. 'Their technology is not only innovative–it's intuitive, scalable, and far beyond what we imagined was possible. The Runa team brought our vision to life with speed, precision, and true collaboration. We're thrilled with what we've built together and even more excited for what's next.'
Yahoo
03-07-2025
- Business
- Yahoo
Biggest US Banks Boost Dividends After Fed Stress Tests
JPMorgan Chase & Co., Goldman Sachs Group Inc. and Bank of America Corp. were among firms raising quarterly payouts following the Federal Reserve's annual review last week showed that all banks examined would maintain enough capital to withstand a hypothetical economic downturn. Tom Metcalf reports on Bloomberg Television. Sign in to access your portfolio
