IPA responds to FCA Motor Finance Redress Scheme consultation and Insolvency Service Personal Insolvency Review
15 December 2025
The IPA is pleased to share our responses to both the FCA’s Motor Finance Redress Scheme consultation and the Insolvency Service’s Personal Insolvency Review – two major policy developments for the profession. Together, they highlight the evolving landscape in which IPs operate, and the IPA continues to be closely engaged in shaping thinking, offering insight and ensuring that the profession’s voice is heard as future frameworks are developed.
1. FCA Motor Finance Redress Scheme consultation
Following the Supreme Court judgment in August on motor finance commission mis-selling, the FCA has consulted on a consumer redress scheme. As the regulator of insolvency practitioners handling more than 300,000 appointments, the IPA has responded because this scheme directly impacts our core statutory obligations under the Insolvency Act 1986: maximising returns to creditors, protecting the public interest, and ensuring fair treatment across the profession.
The motor finance redress scheme can deliver £71m value to insolvency estates, but only with proper protocols. Without mandatory register screening, the scheme will cost creditors £27m more than it delivers.
Our analysis shows insolvency protocols aren’t optional; they’re economically essential. The £67.3m difference between deficit and recovery makes this clear.
The IPA’s response ensures the FCA understands what’s required to make this scheme work with, not against, established insolvency processes.
2. Insolvency Service Personal Insolvency Review
Our submission to the Insolvency Service Personal Insolvency Review supports a modern regime that provides genuine debt relief and a sustainable fresh start for those in serious financial difficulty, while ensuring fairness to creditors and addressing misconduct.
Drawing on our regulatory expertise and extensive engagement across the sector, we outline key considerations for the Government as it develops future policy. These include the need for decisions to be based on comprehensive data across all debt solutions; clarity on alignment with regimes in Scotland and Northern Ireland; transparent assessment criteria; full costing of current and future solutions; and clarity on funding, creditor interests and the respective roles of the public and private sectors. We also emphasise the importance of proportionate, consistent regulation and an approach that accommodates individual debtor circumstances.