Are PCP and car finance claims legit, or a scam?
PCP and car finance claims are based on a real FCA investigation into hidden commission arrangements on car finance agreements taken out between 2007 and 2024.
But the sector has been prevalent to scams, especially through cold calls, texts and misleading adverts, rather than in the claims process itself.
You can complain to your lender yourself for free or Claim-Smart can help if you'd rather have support.
You've probably seen the headlines, and maybe had a text, email or call about it too. With so much noise around PCP and car finance claims, it's fair to wonder whether the whole thing is legitimate, or whether you're one bad click away from being scammed.
We are FCA regulated too, so you know you’re in safe hands.
Are PCP and car finance claims legit, or a scam?
PCP and car finance claims are based on a genuine scheme run by the Financial Conduct Authority (FCA), looking at the commission that some lenders and dealers didn't properly explain to customers between 2007 and 2024. That part is real, regulated and isn't going away.
The scam problem sits somewhere else, mostly in how the topic gets marketed.
Cold calls, spam texts and pushy adverts have sprung up around car finance claims because millions of people could be affected, which makes an obvious target for fraudsters and some fairly aggressive claims firms.
Neither of those things means your actual claim is fake, but it’s worth staying vigilant around who you trust with your information.
What does a genuine PCP or car finance claim actually involve?
A genuine claim is a complaint that your car finance agreement wasn't sold to you fairly, usually because of a commission arrangement between your dealer and lender that wasn't properly disclosed to you.
It applies to Personal Contract Purchase (PCP) and Hire Purchase (HP) agreements taken out for personal use between 6 April 2007 and 1 November 2024. You send your complaint to your lender directly, or through a claims management company, and it gets reviewed under FCA rules. If you disagree with the outcome, you can take it to the Financial Ombudsman Service afterwards.
If you're not sure whether your agreement is covered, it's worth checking whether you were mis-sold car finance or working out if you're entitled to claim before you go any further.
Compensation is worked out using the FCA's methods rather than a flat amount for everyone; our guide on what the average pay-out for a PCP claim looks like explains how the numbers can vary.
If you'd like help working out whether your agreement might qualify, Claim-Smart can check it for you and explain what to do next.
Why do some people think PCP and car finance claims are a scam?
Mostly because of how the topic has been marketed, not because of the claim itself.
Millions of agreements are potentially affected, and that scale has attracted a lot of noise: cold calls, spam texts, emails and social media adverts that blur the line between genuine information and a sales pitch.
On top of that, the FCA's compensation scheme was legally challenged and parts of it are currently paused (see why the scheme is currently paused for more), so people who complained a while ago and haven't heard anything can end up assuming the whole thing was a scam in the first place.
Regulators have noticed the same pattern. The FCA, working with the Solicitors Regulation Authority, the Advertising Standards Authority and the Information Commissioner's Office, has been cracking down on misleading car finance claims adverts since January 2024, and has had over a thousand of them removed or changed.
The ICO has also logged more than 230,000 complaints about marketing linked to motor finance claims since the start of 2025. None of that means claims aren't real, it means the marketing around them needs cleaning up, and regulators are actively working on it.
What are the actual scams to watch out for?
The scams might have a clear giveaway. For example, they might claim your compensation has already been sorted, when no lender has actually calculated or paid anything yet under the FCA's scheme.
Common tactics include:
Texts or calls claiming your payout has been "approved" or "calculated," asking you to confirm bank details to release it
Callers pretending to be from your lender or the FCA, asking for personal information
Social media adverts talking about independent advice or "money tips," which are actually paid promotions for a claims firm
"Free checker" tools that exist mainly to collect your details and sell them on to other companies
If you get a message like this, don't click anything, don't share your details, and don't call back on a number it gives you. You can report scam texts by forwarding them to 7726, and report scam calls or suspicious firms to Action Fraud or the FCA.
Do you need a claims management company to make a PCP or car finance claim?
No, you can complain directly to your lender for free, and doing that yourself doesn't put you at any disadvantage.
Complaining to your lender usually means writing to them with your name, address and any details you have about the agreement, then waiting for their response. You don't need your original paperwork to get started; if you've lost your documents, your lender can often still find your agreement using your personal details.
Some people choose to use a claims management company anyway, normally because they don't know who their old lender was, don't want to manage the process themselves, or would rather have someone check the details and chase things up for them. That's a personal choice.
You can complain to your lender yourself using our guide, or if you'd rather have Claim-Smart check your agreement and manage the process, we're happy to help.
What makes a claims management company trustworthy, and how do you check?
A trustworthy claims management company will be on the FCA register, capped in what it can charge, and clear that using it is optional.
Regulators are actively policing this. The FCA, alongside the SRA, ASA and ICO, has been reviewing hundreds of companies across the claims sector, and has already investigated dozens of companies over issues like unclear charges.
Before you sign up with anyone, it's worth running through a short checklist:
Search the firm's name or FCA Firm Reference Number (FRN) on the FCA Financial Services Register to confirm it's authorised
Ask for the fee structure in writing before you agree to anything
Check the firm openly tells you that you can complain for free yourself
Be wary of anyone using words like "guaranteed" or "already approved" about compensation, since no lender has calculated payouts yet
Claim-Smart Limited is a company registered in England, number 12824729, and is authorised and regulated by the FCA under FRN 935960.
When it comes to our fees, they are capped by the FCA depending on how much compensation is awarded:
Redress amount | Maximum fee | Example settlement | Fee you'd pay (incl. VAT) | You'd receive |
£1 - £1,499 | 30% | £1,000 | £360 | £640 |
£1,500 - £9,999 | 28% | £1,500 | £504 | £996 |
£10,000 - £24,999 | 25% | £10,000 | £3,000 | £7,000 |
£25,000 - £49,999 | 20% | £25,000 | £6,000 | £19,000 |
£50,000+ | 15% | £50,000 | £9,000 | £41,000 |
You'd only ever pay a fee like this if your claim results in compensation.
What should you do if you spot a scam or a bad claims company?
Report it, rather than ignoring it and hoping it goes away.
Forward scam texts to 7726, and report scam calls, fake websites or firms pretending to be your lender to Action Fraud or the FCA.
If you're unhappy with the fees or service from a claims management company you've already signed up with, you can usually raise it with the Legal Ombudsman (for SRA-regulated firms) or the Financial Ombudsman Service (for FCA-regulated firms).
Doing this doesn't just protect you. It helps regulators find and shut down the firms and scams causing the problem in the first place.
So, are PCP and car finance claims legit or a scam?
Both, depending on what you're looking at. The claim itself is legit: a real FCA-run scheme covering PCP and HP agreements from 2007 to 2024, with rules that lenders and claims firms have to follow. The scam risk is real too, but it lives in the marketing and cold contact around the topic, not in the claim itself.
You can complain to your lender directly for free, any time before the FCA's current deadline of 31 August 2027 if you haven't already been contacted.
*Please see our terms and conditions for our fee structure and cancellation terms.
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