The financial world is buzzing with two major developments this week:
-
The UK Financial Conduct Authority (FCA) has proposed a £9–18 billion compensation scheme to reimburse consumers mis-sold car finance agreements.
-
Daewoo Engineering & Construction (E&C), a South Korean infrastructure giant, has successfully secured a €200 million foreign currency loan guaranteed by Italy’s SACE.
Both updates showcase how regulators and corporations are reshaping the global finance and loans landscape.
Tackling Years of Mis-sold Car Finance in the UK
The FCA is preparing a public consultation (October 2025) to address mis-sold car finance agreements stretching back to 2007. The estimated cost to lenders is between £9 and £18 billion, making this one of the largest redress efforts in UK history.
Key Highlights of the Scheme
- 14 million agreements may qualify for compensation.
- Average pay out: expected to be in the hundreds of pounds, with some claims reaching £950.
- Timeline: Compensation expected to begin in 2026, avoiding the long delays seen during the PPI scandal.
- Data reconstruction: Lenders won’t be able to dismiss claims using “lost data” as an excuse. The FCA may force firms to rebuild records via third-party sources.
- Fraud prevention: Consumers are warned not to trust scammers offering “early pay outs.” No official communication has been issued yet.
Why It Matters
The FCA faces a delicate balance: ensuring fairness for affected consumers while preventing destabilization of the banking sector. With billions at stake, this scheme will significantly impact both borrowers and lenders in the years ahead.
Daewoo E&C Taps SACE Support for €200M Funding
On September 9, 2025, Daewoo E&C announced the successful completion of a €200 million loan arranged under SACE’s “Push Strategy.”
Loan Details
- Guarantee: Backed by Italy’s export credit agency (SACE).
- Arranger & Manager: Natixis CIB handled structuring, lending, and management.
- Duration: Three years from the first drawdown.
- Strategic Purpose: Strengthen Daewoo’s international financing base and expand cooperation with Italian companies.
About Daewoo E&C
Founded in 1973 and headquartered in Seoul, Daewoo E&C has delivered major infrastructure projects worldwide, such as:
-
Busan–Geoje Fixed Link (South Korea)
-
Houay Ho Dam (Laos)
This new loan underscores the company’s global reach and ability to secure funding for large-scale international operations.
Why These Moves Matter
Both developments reflect critical shifts in the finance and loans sector:
-
For UK consumers: The compensation scheme could deliver long-awaited justice to millions affected by unfair lending practices.
-
For lenders: The cost will be enormous, requiring careful financial planning and increased provisions.
-
For Daewoo E&C: The SACE-backed loan strengthens international partnerships and highlights the importance of global credit guarantees in expanding corporate footprints.
Q1: Who is eligible for the UK car finance redress scheme?
Borrowers with car finance agreements dating back to 2007 involving hidden or discretionary commissions may be entitled to compensation.
Q2: When will consumers start receiving pay outs?
The FCA consultation begins in October 2025, with compensation expected to start flowing in 2026.
Q3: How much could individuals receive?
The average pay out is forecasted at several hundred pounds, with some cases reaching £950.
Q4: What should consumers do right now?
Stay alert — no official claims process has started. Report suspicious calls or emails and wait for FCA’s official updates.
Q5: Who arranged Daewoo’s €200M loan?
The loan was guaranteed by SACE and structured by Natixis CIB. It has a 3-year maturity.
Conclusion
The UK car finance compensation scheme signals a landmark moment for consumer rights, while Daewoo’s SACE-backed loan showcases how international finance is evolving. Both stories highlight the dual focus of today’s banking sector — protecting consumers and enabling global corporate expansion.
Most Read in Articles
Bandhan Bank FY26 Growth: 15–17% AUM via Secured Loans & Retail Push
MSMEs & Vehicle Loans Stress: Rising NPA Risks for Indian Banks
UPI Credit Growth: Digital Loans Backed by Gold, Property & Mutual Funds
Chinese Banks Struggle: Profit Squeeze & $72B Recapitalization Plan
