FCA on PCO rental and motor finance (UK 2026)

Summary

Most PCO rent, lease and rent-to-buy deals used by Uber, Bolt, FREE NOW and Amazon Flex drivers are regulated consumer credit or consumer hire under the Consumer Credit Act 1974 if they are under £25,000 and mainly for personal, not business, use, which means FCA rules and key protections apply. The FCA's 2025 to 26 focus is the wider motor finance commission scandal and a huge redress scheme for mis-sold hire purchase and PCP, which gig drivers with car finance can use, but the regulator has not carved out a special PCO rental regime or named Splend, Otto, Moove or Kojo in public policy statements yet. If a PCO firm behaves badly, for example aggressive repossession, commission or misleading "rent-to-buy" advertising, a driver still has a clear escalation path: complain in writing, use the firm's complaints process, then go to the Financial Ombudsman Service and, for serious credit issues, into the FCA's motor finance redress scheme if the deal is covered.

Key facts (UK 2025 to 26)

National Debtline says that since April 2008, new hire purchase and conditional sale agreements are normally regulated by the Consumer Credit Act 1974 unless you have borrowed more than £25,000 and the agreement is for business purposes.

Connaught Law's 2025 hire purchase guide confirms that hire purchase agreements are a form of consumer credit under the Consumer Credit Act 1974 and that firms offering hire purchase must be authorised by the FCA.

Section 90 Consumer Credit Act 1974 gives "one-third rule" protection for regulated hire purchase agreements. Once you have paid at least one-third of the total price, the lender cannot repossess the car without a court order, and unlawful repossession after that point can entitle the borrower to their money back and compensation.

The Consumer Credit Act 1974 also gives a "half rule" termination right under section 99 for regulated hire purchase and conditional sale agreements, allowing borrowers to hand the car back after paying half the total price, although PCP structures can make this right hard to use in practice.

The FCA consulted on an industry-wide motor finance consumer redress scheme in October 2025 (CP25/27) to compensate people mis-sold car finance with unfair commission structures between 6 April 2007 and 1 November 2024.

On 26 March 2026, the FCA published PS26/3 confirming the motor finance redress scheme, saying it would return about £7.5 billion to people with mis-sold car finance and that millions of claims should be settled in 2026 and most by the end of 2027.

The confirmed scheme covers regulated car finance agreements where a discretionary commission arrangement or similar commission created an "unfair relationship" under the Consumer Credit Act 1974, but pure business leases are outside scope and PS25/18 confirms leasing complaints have different handling rules.

PCO firms such as Splend openly advertise "PCO car hire" and "Flexi Own" rent-to-buy style plans with weekly payments and an option to own, which in legal terms can fall into regulated hire purchase, conditional sale or consumer hire, depending on the fine print.

FCA "Treating Customers Fairly" and Consumer Duty principles still apply to authorised lenders and brokers dealing with gig drivers, including clear communication, fair treatment of people in financial difficulty and avoiding exploitative or misleading products.

Legislation, case law, regulation

Consumer Credit Act 1974, especially sections on regulated consumer credit, hire purchase, conditional sale, the "one-third rule" for repossession protection (section 90) and the "half rule" termination right (section 99).

FCA motor finance redress scheme PS26/3 (26 March 2026) and consultation CP25/27 (October 2025), which create an industry-wide scheme for mis-sold discretionary commission arrangements and related unfair motor finance practices between 2007 and 2024.

FCA policy statement PS25/18 (1 December 2025) on changes to the handling rules for motor finance complaints, which confirms leasing agreements are excluded from the redress scheme and sets complaint response time changes.

FCA Principles for Businesses and Consumer Duty, which require authorised firms to act honestly, fairly and professionally in the best interests of customers, give clear information and provide appropriate support to customers in difficulty.

The Supreme Court decision in August 2025 on motor finance commission, referenced in commentary on the FCA redress scheme, clarified that undisclosed or excessive commission can still create an "unfair relationship" under the Consumer Credit Act 1974.

How it actually works

From a driver's point of view, there are roughly three kinds of car deals for gig work. First, straight PCO rental, where you pay a weekly fee to use a licensed private hire vehicle, often with insurance and servicing included, and there is no realistic path to own. Second, rent-to-buy or "Flexi Own" deals, like some Splend plans, where weekly or monthly payments include an option to buy at the end, which often means hire purchase or conditional sale in legal terms. Third, ordinary car finance such as PCP or hire purchase taken from a dealer or finance company before you put the car on Uber or Bolt.

Pure short-term PCO rental that is genuinely just rental, no option to buy and clearly business-only, may sit closer to business leasing and can fall outside some of the Consumer Credit Act protections. But many "rent-to-buy" deals marketed to Uber and Bolt drivers look and behave like hire purchase or conditional sale, even if the sales page calls them something softer. If there is an option to own at the end and structured credit over time, that is often regulated consumer credit.

If your agreement is regulated hire purchase or conditional sale under £25,000 and not mainly for business, you have key protections. These include:

Written agreement and clear disclosure of cost, interest, total amount payable and rights.

One-third rule protection. Once you have paid one-third of the total, the lender cannot repossess the car without a court order.

Half rule termination right, which in theory lets you end the agreement by handing the car back after paying half the total.

The right to complain and, if needed, escalate to the Financial Ombudsman Service.

For many PCO drivers, the immediate issue is what happens if they stop paying. If your deal is a regulated hire purchase or conditional sale, and you have paid less than a third of the total, the lender can usually repossess the car without going to court, but must still follow proper process. Once you have paid a third or more, they need a court order to take the car back without your consent, and if they snatch the car without going to court, that can be unlawful and give you a right to compensation. With PCP, the formal rules still exist but, as academic commentary points out, the half rule often gives little practical escape because so much cost is pushed to the end that drivers do not reach halfway until very late.

The FCA's motor finance redress scheme matters because lots of gig drivers got into cars using standard dealer or broker PCP and hire purchase. If those deals had or unfair commission structures, drivers can be part of the £7.5 billion redress scheme in 2026 to 2027, even if the lender never mentioned Uber or PCO. The fact the car was used for gig work does not automatically remove Consumer Credit Act protection if the agreement is regulated.

For PCO firms like Splend, Otto, Moove, Kojo and smaller operators, the same basic rules apply if they are offering regulated credit. They must be authorised by the FCA for consumer credit, follow Consumer Credit Act rules and treat customers fairly. If they structure deals to dodge regulation, for example calling an ownership plan a "membership" while taking regular payments and dangling ownership, that raises serious fairness questions if drivers are misled.

The FCA has not, in the material reviewed here, issued a PCO-specific regulation note naming Splend, Otto, Moove or Kojo. But the Consumer Credit Act and general motor finance rules still bite. If a driver is trapped in a bad PCO rent-to-buy deal with commission, aggressive repossession or unclear charges, the practical escalation path is:

Ask the firm in writing for a copy of the agreement and a statement of account, including total amount payable, commission, and any arrears.

Challenge unfair terms, unclear charges or aggressive behaviour in a formal complaint to the firm.

If the firm is FCA-authorised for consumer credit and does not resolve the complaint within 8 weeks, go to the Financial Ombudsman Service.

If the deal is a standard PCP or hire purchase with unfair commission between 2007 and 2024, use the FCA motor finance redress scheme once live, instead of or alongside individual complaints.

For unlawful repossession after paying a third, or misuse of section 99 rights, get legal advice, because the Consumer Credit Act gives strong remedies in those cases.

Worked example

Take a 34 year old Uber and Amazon Flex driver in London using a rent-to-buy plan. The advert says "PCO car hire, own your Uber-ready car with flexible weekly payments, no credit check, PCO and insurance included." The weekly payment is £240. The total term is 4 years. The total to pay works out to about £49,900 once all weekly payments and a small final fee are added.

If the fine print is a regulated hire purchase agreement under £25,000, the Consumer Credit Act 1974 rules kick in, but if the total credit is above £25,000 and mainly for business, it may not be regulated in the same way. National Debtline warns that since April 2008, agreements over £25,000 for business purposes may sit outside Consumer Credit Act protection. A driver locked into a big weekly payment might find they do not have the full one-third protection if the agreement is not regulated consumer credit.

Suppose the agreement is regulated and the driver has paid £18,000 so far, more than a third of the total payable. The PCO firm turns up one night and removes the car from the street without a court order after two missed payments. If this is a hire purchase or conditional sale regulated by the Consumer Credit Act 1974, section 90's one-third rule may have been broken. That means the driver could argue the repossession was unlawful, the agreement ended and they should get all money paid back, plus potential compensation. At the very least, the driver has a strong complaint to the firm and then the Financial Ombudsman Service.

Now add the FCA motor finance redress scheme. If the same driver also has a separate PCP he took out in 2018 on another car used for gig work, and that PCP had a discretionary commission that pushed up the interest rate, that deal falls squarely into the FCA redress scheme's 2007 to 2024 window. He can use the scheme to get back some of that commission-driven cost, regardless of his PCO rental situation.

What Reddit, TikTok and forums get wrong

Misinformation: "PCO rent-to-buy is just a business deal so you have no rights if they take the car." This is common in driver groups. Correction: if the agreement is regulated hire purchase or conditional sale under the Consumer Credit Act 1974, the one-third rule and half rule apply, and lenders need a court order to repossess after a third has been paid.

Misinformation: "The motor-finance commission scandal is only for normal retail customers, not Uber or Bolt drivers." Correction: the FCA motor finance redress scheme covers regulated consumer credit agreements between 2007 and 2024 with unfair commission. If your deal was regulated, using the car for gig work does not automatically strip you of protection.

Misinformation: "If a PCO firm is not called a bank, the FCA has nothing to do with it." Correction: any firm offering regulated hire purchase or consumer credit generally needs FCA authorisation and must follow Consumer Credit Act and FCA rules. Offering regulated credit without permission can be a criminal offence.

Action steps for the reader

Dig out your PCO, rent-to-buy or motor-finance agreement and check whether it says hire purchase, conditional sale, PCP or lease, and whether the credit is under or over £25,000.

Work out how much of the total you have paid. If it is more than a third and the agreement is regulated hire purchase or conditional sale, know that the lender should not repossess without a court order.

If your deal started between 6 April 2007 and 1 November 2024 and involved high or undisclosed commission, keep an eye on the FCA motor finance redress scheme in 2026, because you may be due compensation even if the car was used for Uber or Amazon Flex.

If a PCO firm has already taken your car without court after you paid a third or more, get advice and make a formal complaint, then go to the Financial Ombudsman Service if needed.

Do not sign new long-term PCO or rent-to-buy contracts based only on a sales page. Ask for the full agreement, check whether it is regulated credit, and read the repossession and termination clauses before committing.

Related tools GigKiln should build

"Is my PCO deal regulated?" checker that uses total amount, purpose and contract type to show likely Consumer Credit Act coverage.

One-third and half-rule calculator that shows when a driver gets extra repossession and termination protection.

Motor-finance redress eligibility checker for gig drivers with PCP or hire-purchase between 2007 and 2024.

PCO complaint and Ombudsman letter generator for drivers facing aggressive repossession or unfair charges.

Related guides

"Hire purchase, PCP and PCO rent-to-buy, what protections gig drivers really have."

"The FCA motor-finance commission scandal, how Uber and Amazon Flex drivers can claim."

"Repossession of your PCO car, when the firm is breaking the law."

"How to read a PCO rental or rent-to-buy contract before you sign."

Sources

National Debtline, "Hire purchase debt", accessed 19 April 2026.

Connaught Law, "Hire Purchase Agreements UK 2025 | Legal Guide & Rights", published 20 October 2025, accessed 19 April 2026.

FCA, "CP25/27: Motor finance consumer redress scheme", consultation paper published 5 October 2025, accessed 19 April 2026.

FCA, "PS26/3: Motor finance consumer redress scheme", policy statement published 26 March 2026, accessed 19 April 2026.

FCA, "FCA confirms motor finance redress scheme", statement published 29 March 2026, accessed 19 April 2026.

FCA, "Millions of car finance customers to get payouts this year as FCA goes ahead with compensation scheme", press release published 29 March 2026, accessed 19 April 2026.

FCA, "PS25/18: Changes to handling rules for motor finance complaints", published 1 December 2025, accessed 19 April 2026.

Splend, "PCO Car Hire London | Flexible PHV Rental with Insurance", published 23 June 2025, accessed 19 April 2026.

Splend, "Flexi Own Plans | Car Ownership for PCO Drivers", published 14 October 2024, accessed 19 April 2026.

Splend, "Frequently Asked Questions | Splend | London", accessed 19 April 2026.

Fleeto, "Rent to Buy | Own Your Uber-Ready PCO Car with Flexible Plans", published 8 September 2025, accessed 19 April 2026.

Oxford Business Law Blog, "From Consumer Redress to Regulatory Reform: The Challenge of PCP Mis-Selling and Consumer Credit Act Rights", published 8 October 2025, accessed 19 April 2026.