7:09 am, October 14, 2026
Renault’s UK finance business has plunged to a whopping £110.4m pre-tax loss after being hammered by the car finance mis-selling scandal.
RCI Financial Services has seen its profits wiped out by the growing compensation bill, with the lender now putting aside £219.2m to cover potential claims.
Accounts recently filed at Companies House show that the firm swung from a pre-tax profit of £8.7m in 2024 to a loss of £110.4m last year.
The figures, first reported by The Times, show that the lender took a £150m charge in 2025 following the publication of the Financial Conduct Authority’s (FCA) findings into historic motor finance commission arrangements.
That helped push its total provision for liabilities from £73.6m to £219.2m by the end of December.
The Rickmansworth-based company, which provides finance for Renault, Nissan and Alpine vehicles, has warned that the ultimate cost of compensating customers remains uncertain.
Its accounts say: ‘The company’s provision estimates outstanding staff costs, administration costs, remarketing costs and other costs associated with its provision, resulting in the likelihood of a higher level of claims in the future.’
The firm also warns that the final cost of redress could differ from the amount currently set aside.
The scandal has overshadowed what was otherwise a year of improving income for the lender.
The accounts reveal that total income climbed from £338.4m to £438.7m, while net interest income rose from £62.2m to £88.9m.
However, those improvements were not enough to offset the impact of the compensation provision, increased operating costs and other charges.
The firm ended the year with an after-tax loss of £83m, compared with a profit of £6.7m in 2024.
No dividend was proposed for the financial year.
The results come as the motor finance industry continues to grapple with the fallout from historic commission arrangements between lenders and car dealers.
The FCA has introduced an industry-wide compensation scheme covering potentially unfair finance agreements entered into between April 2007 and November 2024.
The regulator estimates that around 12.1m agreements could be eligible for compensation, with payouts expected to reach approximately £7.5bn.
Administrative costs could add another £1.6bn to the industry’s overall bill.
However, the scheme is facing legal challenges from major finance providers, including Volkswagen, Mercedes-Benz and Crédit Agricole, as well as a consumer group.
Parts of the compensation programme have been suspended while those challenges are considered, although firms must continue to comply with the requirements that remain in force.
Renault is the latest automotive giant to reveal the financial impact of the scandal.
Volkswagen’s UK finance operation has already set aside £725m for potential compensation claims, while Stellantis’s British lending arm has made provisions of more than £221m.
RCI’s directors say the company continues to monitor developments surrounding the compensation scheme, with further uncertainty over the eventual financial impact.
Despite the huge loss, the accounts confirm that the directors have prepared the financial statements on a going concern basis, with continued financial support available from the wider RCI banking group.