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Questions about a Commission Arrangement

If you have a query relating to a commission arrangement associated with your agreement, please click here for further information

COMMISSION ARRANGEMENT COMPLAINTS

29 October 2024 Update

On 25 October 2024 the Court of Appeal issued a judgment which goes beyond the scope of the current Financial Conduct Authority (“FCA”) motor commission review. Whether the Judgment applies to commission types outside of the FCA’s motor finance review into discretionary commission arrangements (“DCA”) is not yet clear. While the Judgment is likely to extend the current period of uncertainty for customers, lenders and dealers alike, we are seeking clarity with the FCA and will update this page with any new information. This does not impact your ability to raise a complaint at any time, should you wish to do so.

 

 

If you would like to raise a complaint and it falls within the FCA’s motor finance review of DCAs, this will still be subject to the pause the FCA introduced on complaint handling rules, and you will not receive a response within the usual 8-week deadline.  Further information can be found below. If your complaint does not involve a DCA, it will not be subject to the FCA’s pause at this time, however this could change, for now we will handle your complaint in accordance with our normal complaints handling process.

Discretionary Commission Arrangements:

24 September 2024 Update

On 24 September 2024, the FCA announced they are extending the pause on complaint handling rules for discretionary commission arrangements (“DCAs”). They will now announce the findings of their investigation in May 2025 and have extended the pause on complaints handling to 4 December 2025.

The Financial Conduct Authority (“FCA”) has described a discretionary commission arrangement (“DCA”) as an arrangement between lenders and brokers which allowed the broker to adjust the interest rates offered to customers. Typically, the higher the interest rate, the more commission the broker received. This practice was banned by the FCA in 2021, however they are now undertaking a review of the industry to understand whether there has been a widespread failure to comply with relevant requirements, resulting in financial loss or harm to consumers.

You may have an eligible DCA complaint if:

  1. You used car finance to buy a car before 28 January 2021, this includes conditional sale agreements and fixed-sum loan agreements.

  2. A discretionary commission arrangement was operated in relation to your agreement.

    If you have an eligible DCA complaint, you will not receive a final response within the usual 8-week deadline. The FCA has extended the deadline until 4 December 25.

If you’re unhappy with our final response

You’re able to take your complaint to the Financial Ombudsman Service (“FOS”). Usually, you have six months from the date of our final response letter to refer your complaint, however, as a result of the pause to complaint handling, this has been extended by up to 15 months.

Further information

For further information, you can visit the announcement on the FCA’s website here.  

To make a complaint

To make a complaint to us in relation to a commission arrangement, please complete the below form:

PCP & PML Customers               Contract Hire Customers

Frequently asked questions

What is a Discretionary Commission Arrangement?

The FCA have defined a discretionary commission arrangement (“DCA”) as a commission arrangement in which lenders allowed brokers (the person that arranges the loan, for example, your car dealer) to adjust the interest rates they offered customers for car finance. Typically, the higher the interest rate, the more commission the broker received.

How do I know if a DCA was applicable to my agreement?

If you submit a complaint to us, we’ll investigate your complaint in line with our complaints handling process. As part of this, we will assess whether a DCA was in use when you took out your agreement. If a DCA was in use, we won’t issue you with a final response yet as a result of the pause requested by the FCA on complaints handling.

If a DCA was not in use, we’ll handle your complaint in line with our normal process.

Will I receive compensation?

The FCA is undertaking a review of the industry to understand whether there has been a widespread failure to comply with relevant requirements, resulting in financial loss or harm to consumers. Until they have completed their work and finalised their review, they are not able to say whether this is the case or not.

When will I receive a response to my DCA complaint?

You will receive a final response from 4 December 2025 in line with the FCA pause whilst they complete their review.

What if I’m not happy with the outcome of my complaint?

You can refer your complaint to the Financial Ombudsman Service (“FOS”) within 15 months of having received your final response (if you have an eligible DCA complaint).

I am having difficulties completing the form, how else can I get in contact?

If you are having difficulties completing the form please click here to see how you can get in contact.

 

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Account Management Fees
Copy statement of account £12.00
Change of payment due date* £25.00
Change of vehicle registration plate £30.00
Collection of vehicle upon voluntary termination of agreement £70.00
Transfer of agreement fee** £150.00
Arrears Management Fees
Monthly arrears fee*** £35.00
Internal collection agent visit £50.00
External collection agent visit £250.00

* One change of payment due date is allowable free of charge any time during the agreement.
** Only applicable for agreements not regulated by the Consumer Credit Act, i.e. transfers from one limited company to another limited company.
*** When your payment is made late and for every subsequent month that your agreement remains in arrears, limited to 3 in any single defaulting period. The charges detailed within this document are correct as at 30th July 2014. Kia Finance reserves the right to amend these fees at any time.