Up to 14.2 million people could each receive an average of £700 in compensation due to car loan mis-selling, the financial services regulator has said.

Nearly half (44%) of all car loan agreements made since April 2007 up to November 2024 could be eligible for payouts, the Financial Conduct Authority (FCA) said.

Those eligible for the compensation will have had a loan where the broker received commission from a lender.

Lenders broke the law by not sharing this fact with consumers, the FCA said, and customers lost out on better deals and sometimes paid more.

A scheme is seen by the FCA as the best outcome for consumers and lenders, as it avoids the courts and the Financial Ombudsman Service, therefore minimising delay, uncertainty and administration costs.

Anyone who may have been impacted has been advised to complain to the institution that lent them the money.

The scheme will be funded by the dozens of lenders involved in the loans, and cost about £8.2bn, on the lower end of expectations, which had been expected to reach as much as £18bn.

The figure was reached by estimating 85% of eligible applicants will take part in the scheme.

Anyone who believes they have been impacted should contact their lender. Compensation will begin to be paid in 2026, with an exact timeline yet to be worked out.

UK steel manufacturers are to be hit by another round of tariffs, even higher and more impactful than those levied by the US, representing “an existential threat” to the industry.

The European Union (EU) is hiking the tax on steel it imports, with the tariff to be 50%, double the 25% currently levied by the Trump administration in the US and the EU’s current rate.

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This decision is an “existential threat”, according to the assistant general secretary of the Community union, Alasdair McDiarmid.

“Europe is by far the largest destination for UK steel exports, and losing access to this market would have a catastrophic impact on British jobs,” he said.

UK Steel, the steel industry body, described it as “perhaps the biggest crisis the UK steel industry has ever faced” and called on the government to “secure UK country quotas”.

Establishing a UK country quota could mean some steel is traded with lower or no tariffs at all.

If this is not arranged, the industry would “potentially face disaster”, said Gareth Stace, the director general at UK Steel.

Why is the EU doing it?

The EU is erecting the trade barrier to avoid an influx of steel imports flooding its market in the wake of the US’s tariffs hike and to avoid making the EU less competitive for domestic producers.

EU commissioner for prosperity and industrial strategy, Stephane Sejourne, said the EU was also reducing the amount of steel being imported from abroad to “save our European steel plants and jobs”.

Similar measures have been called for by UK Steel.

“The UK government must now recognise the urgent need to put in place its own measures to defend against a flood of imports,” Mr Stace said.

“The probability of the EU’s measures redirecting millions of tonnes of steel towards the UK could be terminal for many of our remaining steel companies.”

Detail of when the policy will take effect has yet to be announced.

Responding to the news, industry minister Chris McDonald said,

“We will always defend our critical steel industry, which is why we are pushing the European Commission for urgent clarification of the impact of this move on the UK.”

“It’s vital we protect trade flows between the UK and EU and we will work with our closest allies to address global challenges rather than adding to our industries’ woes.”

When asked about the topic, Prime Minister Keir Starmer said, “Our position in relation to our steel industry is one of strong support.”

He added: “In relation to the question of tariffs or other measures, as you’d expect, we are in discussions with the EU about this, as we’re in discussions with the US about it. So I’ll be able to tell you more in due course.”

Every week, the Money blog team answers a reader’s financial dilemma or consumer problem – email yours to moneyblog@sky.uk. Today’s is…

A neighbour has borrowed more than £1,000 from me with the promise to pay me back by the end of the month. Nothing has been forthcoming. I’ve sent her texts asking for her to let me know when she is putting it in to my account… no answer at all. What are my legal options?
Tony, via comments box

Thanks for your message, Tony – I wish I had a neighbour as generous as you.

From what you describe, there was an oral agreement here, which isn’t the best grounding to get your money back.

The neighbour might argue that there were no particular payment terms (so that the loan is not due by the end of the month) or even that there was no loan at all (that the money was instead a gift).

It would then be up to the court to decide on the evidence whether a loan existed and what its terms were.

I spoke to solicitor Alex Kennedy, a dispute resolution expert at Gannons, to get some firm guidance for you.

“Evidence of messages, bank payments etc are so important,” he says.

“If there are no documents at all, the person who is owed the money could still present their case, it is just the trial judge would be weighing their witness evidence against that of the borrower.”

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So what can you do now?

Kennedy says the most obvious legal route now is to send a formal letter before action to your neighbour, setting out:

• The amount owed;
• The basis of the debt (ie, the loan made and her agreement to repay by the end of the month);
• What steps you have already taken to request payment;
• A clear deadline (usually 14 days) for repayment before you take legal action.

This can be done by you or a solicitor and could well prompt your neighbour to cough up.

“Tony will need to bear in mind whether the relatively small value of the loan means that instructing a solicitor is a disproportionate expense, especially given that it is unusual to recover legal costs in respect of a small claim,” Kennedy says.

“If the cost of a solicitor is considered to be excessive, we would still recommend that the person who is owed the money drafts a letter before action themselves.”

If your neighbour is still not budging, there’s the option to issue a claim online via the Money Claim Online service or through the local county court.

The claim fee depends on the size of the debt (for £1,000-£1,500 it is currently £70 if issued online).

If successful, you will obtain a county court judgment.

Kennedy says your reader can enforce the judgment in several ways, including:

• Instructing bailiffs (county court or high court enforcement officers);
• Obtaining an attachment of earnings order (if she is employed);
• A charging order against property (if she owns her home).

“Interest and some legal costs can be claimed as part of proceedings, but as I have set out above, they may be limited given the value of the debt,” Kennedy says.

Of course, only you can decide whether taking any of these steps against someone you’ll be seeing all the time is the right way to go.

Good luck with it!

This feature is not intended as financial advice – the aim is to give an overview of the things you should think about.

Submit your dilemma or consumer dispute via:

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• Or email moneyblog@sky.uk with the subject line “Money Problem”