Claims Management Company Fees Capped By FCA

Published / Last Updated on 30/11/2021

The Financial Conduct Authority (FCA) has confirmed that it will cap the fees charged by Claims Management Companies (CMCs) to consumers given wide abuse and overcharging.  It is hoped that the move will ‘clean up’ the CMC market.

The reality is that it is free to make a complaint to financial organisations and then also free to then take your complaint to the Financial Ombudsman Service (FOS) for independent arbitration and a legally binding ruling on the financial firm by the FOS.

Currently, CMCs can charge what they like and many firms hide their charges in the small print.  From 1st March 2022, the maximum fee a CMC will be allowed to charge is £10,000. 

To charge a fee of £10,000 the compensation won by the CMC must exceed £50,000.

There is a sliding scale cap on maximum fees based upon the size of the compensation awarded:

Compensation Awarded

Maximum CMC Capped % Fee Charge

Maximum CMC Fee Charge in £

£50,000 +



£25,000 to £49,999



£10,000 to £24,999



£1,500 to £9,999



£1 to £1,499



Maximum CMC charge for all compensation claims started after 1st March 2022.


We still do not like the link to a % of the compensation amount.  There may be two identical claims based upon circumstances meaning exactly the same work is carried out by the CMC in terms of hours, time, expertise but just because one has a larger value than the other, the CMC can charge more.  It should be set fees and not linked to size.

Is this the start of the FCA capping fees for all regulated activities?

This is a first move of its kind to cap fees by the regulator and we can see this moving on to general financial services works, it may not be long where the FCA issues guidance or even fees caps for a maximum fee scale for different types of advisory works.  We suggest this is necessary to protect the consumer but also to increase competition.

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