UK car finance: ‘millions of drivers could get payout’ as watchdog investigates

In recent years 80% to 90% of new cars and an increasing number of used vehicles have been bought with finance agreements. Photograph: Matt Cardy/Getty

Millions of drivers could be in line for a payout, it has been claimed, after the UK financial watchdog opened an investigation into whether consumers had been unfairly charged inflated prices for loans on new and secondhand cars.

The Financial Conduct Authority said on Thursday that it had decided to examine whether a compensation scheme was needed to deal with alleged large-scale mis-selling in the £50bn-a-year motor finance sector.