Guernsey’s GFSC reviews its MOTOR TRADE compliance with the Lending, Credit, and Finance regime.

On 27 March 2026, the GFSC issued its report on its first thematic review under the Lending, Credit, and Finance regime. 

The thematic review focused specifically on MOTOR FINANCE, and

• Assessing how well firms are complying with the new regulatory regime since it came into full effect in July 2023.

‘MOTOR FINANCE’ in the context of the thematic refers to

• Loans and credit agreements that help individuals spread the cost of buying vehicles such as cars, motorbikes, or scooters for personal use.

 In the Bailiwick, MOTOR FINANCE agreements commonly take the form of

• Personal loans,
• Hire purchase (HP),
• HP with a balloon payment and
• Personal contract purchase (PCP) agreements. 

Included in the scope were two main types of firm –

• Credit providers (or lenders) and
• Credit brokers (usually motor traders or garages), who arrange loans on their customers’ behalf during the process of selling a vehicle.

As part of the thematic, the GFSC  

• Launched a public survey to gather people’s personal experiences of obtaining motor finance in the Bailiwick.
• Sent questionnaires to lenders and brokers,
• Conducted desk-based reviews, and
• Made 15 onsite visits,

Together, the above provided a comprehensive picture of industry practice.

The findings of the thematic review were broadly positive, with most firms demonstrating

• Their commitment to meeting the requirements of the LCF legislation and
• Embedding fair treatment of customers within their practices. 

The key findings were as follows:

Good

• Generally, firms are treating customers fairly
• Firms no longer use discretionary commission arrangements, although improvements must be made to commission disclosure processes
• Firms take into account the individual circumstances of those customers in arrears and consider a range of appropriate forbearance options
• Firms are generally providing their customers with the loan APR, in accordance with the Rules
• Motor finance advertising is generally clear, but compliance with the LCF Rules is inconsistent

Not so good

• The information provided by firms to customers could be improved, to ensure that it is complete and (where relevant) accessible.
• The quality of customer records held by motor traders could be enhanced

Looking ahead, GFSC  will work with firms through its ongoing supervision to ensure any necessary improvements are made.

A copy of the thematic review is available

• Here https://www.gfsc.gg/sites/default/files/media/helix-file/Motor%20Trade%20-%20Thematic%20Review%20-%202025.pdf or
• Via the GFSC ’s Legislation and Guidance page under the ‘Thematic Reviews’ heading.   

SOURCE

• https://www.gfsc.gg/news/motor-trade-thematic-review-2025