Martin Lewis has warned car finance compensation payouts could be the “second biggest reclaim campaign” in UK history with drivers set to be owed thousands.
The Money Saving Expert claims firms could hand out “double-digit billions” to affected motorists in the largest compensation scheme since PPI.
The Financial Conduct Authority (FCA) is investigating motor finance firms for “widespread misconduct” after a series of complaints from customers.
It comes after customers may have unknowingly paid discretionary commissions on finance agreements.
It means motorists who purchased a car using a finance deal before January 28, 2021, could be in the set for payouts.
Mr Lewis has previously claimed that a staggering 40 percent of customers could be affected by the scheme.
He now claims the project could be one of the largest reclaim campaigns ever seen with drivers in line for over £1,000.
Martin explained: “A back of the envelope calculation shows this will likely end up being the second biggest ever UK reclaim campaign, after PPI.
“The average payback will likely be over a grand. The big question, if the regulator rules as expected, is whether it’ll be single or double-digit billions that’ll have to be paid back to people.
“I’d urge anyone who had car finance before January 2021 to read the guide and use the free tool as soon as possible to ensure if payments happen, you don’t miss out.”
To help motorists determine if they are affected, MoneySavingExpert has launched a free car finance reclaim guide and tool.
The guide warns hundreds of firms could be involved including major household names.
Experts also urge road users to “act now” to ensure motorists do not miss out when the FCA concludes its investigation.
The FCA said the probe was launched after a “high number of complaints from customers to motor finance firms”.
The Financial Ombudsman Service found in favour of motorists in two recent decisions which is likely to prompt a “significant increase” in complaints.
The FCA claims firms are rejecting complaints because they feel they have not acted unfairly or caused their customers loss.
The review will determine whether customers have lost out with compensation set to be paid out afterwards.
The experts stress that affected vehicle owners will receive an appropriate settlement in an “orderly, consistent and efficient way”.
