Santander UK Chief Executive Mike Regnier has urged the government to weigh in over a car finance pay out plan following a landmark supreme court ruling in August.
He said the level of industry concern warranted material changes to the regulator’s proposals, which are currently under consultation.
“Without such change, the unintended consequences for the car finance market, the supply of credit, and the resulting negative impact on the automotive industry and its supply chain could significantly affect jobs, growth and the broader UK economy,” Regnier said.
Although the bank said it did not expect any material adverse impact on its finances, even in a worst-case scenario, it has already set aside £295m to cover potential payouts.
The controversy follows earlier efforts by Chancellor Rachel Reeves to influence the case. In January, she urged judges to avoid granting windfall payouts to borrowers, though the court ultimately ruled largely in favour of lenders.
The FCA defended its plan, saying a compensation scheme was the best way to settle outstanding liabilities for both lenders and consumers.
“It’s vital we draw a line under the issue so a trusted motor finance market can continue to serve millions of families every year,” a spokesperson said.
