The MG MG5 EV was commonly sold on Personal Contract Purchase (PCP) and Hire Purchase (HP) finance agreements during the Financial Conduct Authority's (FCA) investigation period, which ran from 6 April 2007 to 1 November 2024. This period saw a significant number of motor finance agreements being scrutinised due to suspected mis-selling practices involving discretionary commission arrangements.
How the MG MG5 EV was Typically Financed
The MG MG5 EV was often financed through PCP and HP agreements, with typical loan amounts ranging from £15,000 to £30,000. Common finance providers for this model included
Black Horse, Barclays Partner Finance,
Close Brothers Motor Finance,
MotoNovo Finance, and
Santander Consumer Finance. The standard PCP term was 36 to 48 months, with balloon payments representing a significant portion of the total cost at the end of the agreement.
In a typical PCP arrangement for an MG MG5 EV, customers would make monthly instalments over the chosen term, with a final lump sum payment known as a balloon payment required to own the car outright. The HP option allowed for full ownership from day one but often came with higher monthly payments compared to PCP plans.
The FCA Motor Finance Investigation
The FCA's investigation into motor finance agreements uncovered widespread use of discretionary commission arrangements, which were believed to incentivise lenders and dealerships to sell more expensive or less suitable products. These practices affected 12.1 million eligible agreements (FCA, March 2026) during the specified period, resulting in an estimated total mis-selling cost of £7.5 billion (FCA, March 2026). On average, each affected agreement was overcharged by around £829 (FCA estimate).
The investigation revealed that discretionary commissions were often linked to sales volume and profitability rather than customer needs or affordability. This led to customers being offered finance deals that were not in their best interest, such as those with excessively high APR rates or unaffordable monthly payments.
How to Check Your Agreement Look for any mention of discretionary commissions or similar terms in the agreement. check if your contract falls within the relevant date range from 6 April 2007 to 1 November 2024.
Another critical term to look out for is "DCA" (Discretionary Commission Arrangement), which could indicate that your finance deal was part of an arrangement scrutinised by the FCA. If you find any suspicious terms or dates, it may be advisable to seek further advice from a financial advisor or contact your lender directly.
If you believe your MG MG5 EV's finance agreement has been affected by mis-selling practices during the investigation period, you can complain directly to your lender without needing to involve a
claims management company. Common lenders like Black Horse, Barclays Partner Finance, Close Brothers Motor Finance, MotoNovo Finance, and Santander Consumer Finance all offer customer complaint procedures.
When contacting your lender, clearly outline any issues or concerns related to your finance agreement and provide supporting documentation from your original contract. Your lender is required by law to handle your complaint fairly and without undue delay.
You do not need a claims management company; you can address the issue directly with your lender for free. Remember that lenders are obliged to review complaints thoroughly, providing you with a fair resolution based on the evidence presented.
Sources and References
- Financial Conduct Authority (FCA) estimates regarding affected agreements, total mis-selling cost, and average overcharge.
- ONS Census 2021 for population data.
- FOS guidelines on handling motor finance complaints.