AM Online

AM poll: Are the rules surrounding finance commission disclosure clear and is your business ready to implement them?

The confusion surrounding commission disclosure is clearly still extremely prevalent in the automotive retail industry with 79.2% of businesses unclear of the rules.

The Office of Fair Trading (OFT) 2011 Guidance for Credit Brokers and Intermediaries introduced the concept of commission disclosure for dealers selling finance products.

Sue Robinson, National Franchised Dealers Association (NFDA) director, said: “Failure to comply with the OFT guidance could have implications for dealers with regard to their consumer credit licence, particularly the OFT’s view on their fitness to hold one.”

The NFDA has put together an information pack to help dealers implement the OFT guidance for disclosing commission.

Dealers have been expected to comply with the guidance and disclose commission to customers in certain circumstances.

The guide is only available to Retail Motor Industry (RMI) members.

Customers can request that a dealer discloses commission on a deal as part of their consideration before making a purchase, but if a deal has already taken place, dealers can choose not to disclose a figure.

Dealers can also display an average commission across the business, but this is further complicated by the fact it can be very difficult to break down a dealer’s commission on a finance deal, from car to car, to the volume bonus and other money pots attributed to stocking and marketing.

Dealers should contact the NFDA or visit www.
nfdacommissiondisclosure.co.uk for more information.

If you are not a registered user your comment will go to AM for approval before publishing. To avoid this requirement please register or login.

Comment as guest


Login  /  Register

Comments

No comments have been made yet.