FOS motor finance complaints fall

There has been a sharp drop in the number of motor finance complaints to the Financial Ombudsman Service (FOS), which has seen the overall level of complaints fall to the lowest level in two years in Q4 2025.

Between October and December, the FOS received 47,300 complaints compared to 68,400 in the closing quarter of 2024. Of these, 400 complaints were about motor finance compared to 2,200 complaints in Q2 2025/26, and 14,400 in the same period last year (Q3 2024/25).

During the quarter FOS resolved 7,100 complaints about motor finance commission, mainly about fixed commission, noting that “clarity from the Supreme Court judgment in August 2025 – along with a previous High Court judgment” meant it was possible to resolve thousands of motor finance commission complaints where no unfair relationship between the lender and the customer was identified.  

FOS also said the decline in complaints followed an overhaul of rules from regulators and Treasury that means professional representatives now incur a £250 fee for cases beyond the first ten in a financial year. It said this has led to “better evidenced complaints” from professional representatives with fewer cases are being withdrawn or abandoned.

While nearly a third of complaints were withdrawn or abandoned in the last financial year, the rate fell to 19% from April to December. 

“Following a period of extraordinary demand, our case volumes are returning to a steady state as measures we have implemented ensure the complaints that come to us are better evidenced and ready to be investigated.

“The changes we have already introduced – and those we plan to make in the future – will allow us to focus on getting back to our core purpose for customers as a quick, informal and high-quality dispute resolution system.”