Motor finance backlash mounts with calls to pull £4bn from lenders

Motor finance lenders and consumers have criticised the FCA. (Image: PA)

The financial watchdog is back in the hot seat as criticism of its controversial motor finance redress scheme continues to mount.

A fresh report from the All-Party Parliamentary Group (APPG) on Fair Banking has blasted the City watchdog for a “£4.4bn billion gap” in the proposed scheme.

The group accused the regulator of being “influenced by the profit margins of the lenders”.

It marks a new round of criticism for the Financial Conduct Authority ( FCA ) which has also faced fierce opposition from the City’s banking giants. Effectively, criticism is coming from both sides with some – including the APPG’s members – claiming the scheme lets lends off the hook while many analysts and banking chiefs think it goes