Lenders are now installing ‘kill switches’ on cars bought by consumers with poor credit scores

Unscrupulous lenders are targeting desperate customers with poor credit scores whose choices are restricted due to their circumstances with extortionate car finance ‘kill switch’ agreements. This enables the lender to immobilise the car if payments are missed.


The customer sets a standing order up for the payments each month. On receipt, the finance firm sends a code to be entered by remote control in to a GPS device behind the dashboard.

If drivers miss a payment, the code is not sent rendering the car immobilised. Concerns have been raised that vulnerable drivers could be stranded overnight or unable to get to an emergency.

These boxes record a customer’s movements and once a customer has made more than 33% of repayments, the lender has to apply for a Court Order to seize the assets and cannot immobilise the car immediately if a customer stops making repayments.


It could fairly be argued in Court that the customer was an unfair victim under the Consumer Credit Act 1974 if the agreement fails in any way.

The Consumer Protection From Unfair Trading Regulations 2008 protects consumers from unfair or misleading practices.

I believe that a judge would rule that this practice is unfair and a customer would be seen as an unfair victim under this legislation if a case went to Court.

The Financial Conduct Authority is set to investigate car finance with a focus on PCP agreements, and unfair credit agreements and vulnerable customers will fall within their scope.


These devices were originally invented to stop theft and not devised for unscrupulous lenders to use as part of a credit agreement. Experts have cited concerns that these devices could be illegal due to potential breaches of the General Data Protection Regulation Act 2018 (‘GDPR’) and Consumer Credit Act 1974.

What are your thoughts on this? Do you think that the Financial Conduct Authority should do more to regulate the car industry?

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