Mercedes-Benz joins challengers of $12 billion UK car finance redress scheme
29/04/2026 11:35
By Kirstin Ridley and Sam Tobin LONDON, April 29 (Reuters) - Mercedes-Benz MBGn.DE has become the fourth group to challenge a 9.1 billion pound ($12.3 billion) consumer redress scheme imposed by Britain's markets regulator on the UK motor finance industry for misselling historic motor loans. The Financial Conduct Authority said it had received legal challenges from three lenders as well as from a consumer group to its compensation scheme that had been designed to draw a line under a 17-year scandal. "We are considering our approach and will set out more later this week," an FCA spokesperson said. A Mercedes‑Benz Group spokesperson confirmed the company was appealing against the FCA's scheme but declined to comment further. The FCA in March trimmed the final bill for one of Britain's costliest financial misselling scandals in an attempt to balance its duty to protect consumers from harm, promote growth and ward off legal challenges. It had hoped the first payments to customers, who could get an average payout of around 830 pounds per vehicle loan agreement, would start this year. But legal challenges can be lengthy and costly. Leading banks, however, are not challenging the scheme, although Santander UK SANS_pa.L, the British arm of Spain's Santander SAN.MC, set aside another 207 million euros ($242.2 million) to cover redress costs on Wednesday. Banks including Lloyds LLOY.L, Santander, Barclays BARC.L, specialist lender Close Brothers CBRO.L and the finance arms of vehicle manufacturers have collectively set aside billions of pounds for compensation. Sky News reported first that Mercedes-Benz planned to challenge the scheme and that Volkswagen VOWG.DE was expected to follow suit. Volkswagen did not immediately respond to a Reuters request for comment. BMW, meanwhile, told Reuters it had reviewed the redress scheme and believed it provided the fastest and easiest route to resolution for customers. Consumer Voice said on Monday it would launch a legal challenge because it said the FCA scheme failed to deliver fair, adequate or lawful consumer redress. ($1 = 0.7408 pounds) ($1 = 0.8546 euros) (Reporting by Kirstin Ridley and Sam Tobin, writing by Kirstin Ridley; Editing by Sharon Singleton) ((kirstin.ridley@thomsonreuters.com; +44 (0) 207 513 5666;))