Industry30 June 2026
What 'fair value' means
Under the FCA's Consumer Duty, firms that offer or arrange finance are expected to make sure their products and services deliver fair value to customers. Fair value is not simply the lowest price. It is about whether the overall cost a customer pays is reasonable compared with the benefits they receive, and whether any charges, commissions or fees are justified and clearly explained.
Why motor finance is in focus
Car finance is one of the most common ways people in the UK pay for a vehicle. Because agreements can run for several years and involve interest, fees and sometimes add-on products, the regulator has paid particular attention to how firms price these deals and how they disclose the way they are paid. The aim is to make sure customers understand what they are agreeing to and are not paying more than is fair.
What it means for drivers
In practice, fair value should mean clearer information about the total cost of credit, how the finance works, and how any broker or dealer is paid. It is still sensible to compare the total amount repayable, not just the monthly payment, and to read the pre-contract information carefully. If something is unclear, you are entitled to ask the firm to explain it before you commit.
How to protect yourself
Check the annual percentage rate, the total amount repayable, the length of the agreement, and any fees or optional add-ons. Make sure the monthly payment fits your budget comfortably. If you feel a product does not offer fair value, you can raise it with the firm and, if you are not satisfied, escalate a complaint through the firm's process and ultimately to the Financial Ombudsman Service.