Discretionary Commission Arrangements - Compaints and refunds

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Discretionary Commission

In the UK car finance industry, several companies used the Discretionary Commission model before it was banned by the Financial Conduct Authority (FCA) in January 2021. This model allowed car dealers or finance providers to decide the level of commission they earned from arranging car finance for customers, often tying the level of commission to the interest rate. This practice incentivized car dealers to charge consumers higher interest rates to receive a higher rate of commission.

Click the logo below to go to our dedicated Discretionary Commission Arrangement site:



Illustration of Fees

The figures quoted are only calculated on actual money sent to you. If you get a balance reduction, we do not charge any fees on the balance reduction element, just on money sent to you by the lender.


Redress awarded for a claim (£)

The maximum percentage rate of charge

The maximum total charge (£)



30% plus vat



£1,500 - £9,999

28% plus vat




25% plus vat




20% plus vat



£50,000 or above

15% plus vat


These are some examples:

Band 1

Compensation amount £1,000. Our Fee £300 + VAT (£360 inc VAT). You get £640

Compensation amount £1,499. Our Fee £350 + VAT (£420 inc VAT). You get £1,079

Band 2

Compensation amount £5,000. Our Fee £1,400 + VAT (£1,680 inc VAT). You get £3,320 

Compensation amount £9,999. Our Fee £2,083.33 + VAT (£2,500 inc VAT). You get £7,499 

Band 3

Compensation amount £15,000. Our Fee £3,750 + VAT (£4,500 inc VAT). You get £10,500

Compensation amount £24,999. Our Fee £4,166.67 + VAT (£5,000 inc VAT). You get £19,999

Band 4

Compensation amount £30,000. Our Fee £6,000 + VAT (£7,200 inc VAT). You get £22,800

Compensation amount £49,999. Our Fee £6,250 + VAT (£7,500 inc VAT). You get £42,499

Band 5

Compensation amount £50,000. Our Fee £7,500 + VAT (£9,000 inc VAT). You get £41,000



118 118 Money 

Our average refund from 118 118 Money is £2,871.

118 118 Money offers loans of between £1,000 and £3,000 at an interest rate of 49.9% Representative. They also now offer credit cards to the same sub prime group at an interest rate of 34.0% pa. 118 118 Money upheld 43.46% of complaints made between July and December 2020.

More information on 118 118 Money can be found here.

UK Credit 

Making UK Credit Refund Complaints is no different to most other lenders. The challenge with UK Credit is that they like sending information in the post which can become frustrating. When they do send information by email, they encrypt the data (which is good), but they like to embed files in Excel which can be difficult to open. 

UK Credit Refunds are very similar to other Guarantor lenders, such as Amigo Loans. They seem to offer almost exactly the same amounts of money and they charge the same high interest rate. Our average refund for UK Credit claims is £4,177.15

MoneyBarn Car Finance

Moneybarn is a well established car, van and motorcycle finance company. In 2014 it was purchased by Provident Financial PLC. They have not always tretaed customers well or fairly having been fined almost £3m by the FCA. Read about it here. We have an in depth article about Money Barn and the complaints and refund process here. To jump to our Car Loan Refund page click here.

Lending Stream

 Lending Stream Refund Complaint 

 Lending Stream refund complaints tends to get fair payouts for the customer with our average refund for them being £1,524 since our first complaint back in 2017.


Loans2Go (trading name of Loans2Go limited) is a loans provider offering unsecured loans of £250 to £3,000, from 18 months to 24 months.

Loans2Go provide their service of super-fast, easily approved loans at a representative APR of 770%, up to 937.8%. This means if you borrow £550 over 18 months at a flat rate of 180% per annum (fixed) you will be repaying £2,035.08 in total.

Mobile Money 

Mobile Money have been in business for many years and focus on sub prime lending. The interest rates charged by Mobile Money are very high (in our opinion) and appear to vary between 49.9% to 499.9%. Considering they have your car to act as a guarantor of the loan, that seems a lot of interest to charge.

We are starting to get good results with this car finance lender. The average offer is £3,979.35.

Avant Credit

Our average refund from Avant Credit is £4,924.

Avant Credit have lent to more than 80,000 people and have lent a total of £250 million. That tells us that the average loan size is £3,125. They charge 42.5% interest representative, which does make them cheaper than some of their competitors, but still in the mid price range. 

Avant Credit is not accepting any new loans. Avant Credit complaints had 1,545 complaints in 2020 and upheld 32.7% of those complaints.


Guarantor My Loan are another guarantor lender, this time charging 48.9% APR. This makes them slightly better value than Amigo Loans, but still very expensive. With Guarantor My Loan you can borrow between £1,000 and £10,000 over 12 to 60 months.

When we make a Guarantor My Loan refund claim we have to be very careful as they will sometimes make a small offer to the customer and try and get the customer to accept without us knowing. The offer is always a lot less than we would hope to be able to get either as a result of the Guarantor My Loan Refund Complaint or when we take the case to the FOS.


Important Documents


George Banco

Sorry no new claims being accepted

Our average refund is £1,974 from George Banco.

George Banco refunds are quite straight forward. We need to firstly check to see if the loans were irresponsibly lent and we do this by seeing the statements from George Banco and or a full copy of your credit report. As long as we can show the loans were unaffordable we can make a George Banco refund complaint.

George Banco charge 79.9% APR for the Personal Loans they offer and are between £1,000 to £5,000. They also offer Guarantor Loans for £1,000 to £15,000 and charge 49.7% APR.

Buddy Loans 

Now In Administration - Sorry no new claims being accepted

Our average refund from a Buddy Loans complaint is £1,491.

Buddy Loans is a Guarantor Loans company and offer loans of between £1,000 and £10,000. They charge a representative 49.9% and loans can be over 60 months (5 years). As with all other lenders, in order for us to make a Buddy Loans Refund Complaint we need to see that the lending was irresponsible and unfair. We do this by studying your borrowings either via your credit report or statements supplied by Buddy Loans.



Sorry no new claims being accepted

Provident are entering a Scheme of Arrangement the same as Amigo. We have now ceased taking on Povident Claims

Our average refund for a Provident complaint is £3,133

Amigo Loans

Sorry no new claims being accepted

Amigo Loans are trying limit their exposure on Amigo Loan refund complaints. They are intending on entering something called a Scheme of Arrangement. If this happens all payouts will be reduced dramatically. In the interim Amigo Loans are not issuing any offers, but they are still investigating complaints. 

We are happy to continue to take on any new complaints, but you can complain directly as we are unable to offer much added value now.

More information can be found by following this link: https://www.amigoscheme.co.uk

Our average refund for Amigo Loans complaints is £4,435!



Morses Club 

Update August 2022 - Morses Club are trying to enter a Scheme of Arrangement to limit refunds. Act now or never!

Now In Administration - Sorry no new claims being accepted

Our average refund from Morses Club is £1,914. 

Morses Club try and make the complaints process harder than it need be. They often will only post passwords for encrypted files and will often reject complaints, meaning we have to take them to the Financial Ombudsman Service and ask them to investigate. This makes the process very drawn out, but the results are worth the effort.

Morses Club complaints once started operate in the same way as most other lenders. Morses Club are a PLC which means that their shares can be bought or sold by members of the public. They seem to be doing very well with the price of their shares increasing from around 50p in April 2021 to 90p in June 2021. I guess their investors are excited with Provident exiting the door step loan market. Morses also owns and runs Dot Dot Loans, an online "payday loans" style of lender.

Morses Club is a doorstep lender and pride themselves on offering a friendly, personal service, which is really not saying much as all companies should be offering a friendly personal service.


Everyday Loans

Sorry no new claims being accepted

Everyday Loans is a trading style of Everyday Lending Limited, an independent personal loans lender based in the UK.

They lend from £1,000 up to £15,000 over a minimum term of 18 months up to 60 months, at a Representative APR 99.9%.

Varooma Logbook / V5 Loans

Now In Administration - Sorry no new claims being accepted

Update - Varooma has entered Administration. We are not now taking on new Varooma complaints.

Varooma is trading name of Greenlight Credit Ltd and they offer loans using your car as security. In fact, if you go ahead and borrow from them, you will actually sign the ownership of the car over to them. They will put it back in your name if you pay off the loan, but if you don't or you default, they will take your car from you.

Our refund from Varooma Logbook Loans is £1,924


Safety Net Credit 

Indigo Michael Limited (Trading as SafetyNet) Now In Administration - Sorry no new claims being accepted

Indigo Michael Limited, a financial services company trading as SafetyNet, has recently been placed into administration. The company was founded in 2012 and quickly gained a reputation for providing a variety of loan products and other similar services to consumers throughout the UK.

On the face of it what Safety Net Credit are offering is an excellent idea as they offer a line of credit to save you from bank fees or worse. However, we have seen many cases where the customer was paying out so much in interest to SNC that they could not stop using them. It seemed the only way to stop being reliant on SNC was to make a complaint via us here at Redbridge Finance.

Safety Net / Safety Net Credit / SNC are trading names of a company called Indigo Michael Ltd, who also own and runs another brand called Tappily. Safety Net Credit charges 0.8% per day which is the most that legally they are allowed to charge. It might not sound like much but that works out at 68.7% APR and that makes Amigo look good value!

Our average win is £1,185 for Safety Net Credit (SNC)


Black Horse Discretionary Commission - Background

The impact of the Black Horse Discretionary Commission on consumers was significant, leading to concerns and complaints[1]. The Financial Conduct Authority (FCA) launched a probe into historic commission agreements by motor finance companies, including Black Horse[3]. Prior to January 2021, some lenders and car dealers used discretionary commission arrangements, allowing them to set the interest rates in customer contracts[4]. This practice potentially led to unfair finance deals and higher interest rates for consumers[4][5].

The FCA banned discretionary commission arrangements, recognizing that they created inherent conflicts of interest and could result in customers being sold unfavorable finance contracts[3]. The FCA's actions aimed to protect consumer interests and promote fair business practices in the motor finance industry[3].

The investigation into Black Horse and other motor finance firms' discretionary commission practices has the potential to result in significant compensation claims[2]. Lloyds, the parent company of Black Horse, is estimated to face a substantial financial impact from these claims[2]. This underscores the scale of negative consequences that consumers faced as a result of the discretionary commission model[2].

It is essential for regulatory bodies to closely monitor and address industry practices that may harm consumers. The FCA's intervention in the case of the Black Horse Discretionary Commission demonstrates their commitment to protecting consumer rights and promoting fair practices in the financial sector.

Note: The information provided above is based on the sources listed below:


  1. Motor commission complaints | Black Horse

  2. FCA launches probe into historic commission agreements by motor finance

  3. Millions of drivers could be due pay outs as FCA launches car finance

  4. Decision Reference DRN-4188284

  5. UK auto lenders could face £13bn bill after FCA probe into commissions