According to the FT.com, the Treasury has sought permission to intervene in the upcoming Supreme Court case after several banks and lenders in the sector became exposed to multi-million Pound fines following a court case in October last year.
The Treasury has warned that last year’s case could damage Britain’s reputation as a place to do business.
Reeves fears the case could cause chaos in the motor finance and wider automotive sector making it harder for consumers to get loans, said the FT.
At the time of the initial ruling, several banks ceased lending for several days while systems and paperwork were revised to cope. However, since then, banks in the sector have been making huge financial provisions to cover any potential future ruling by the Supreme Court.
Several national papers have recently reported that the motor finance case is also playing a part in banks either pulling out of the automotive industry or the UK as a whole.
Rachel Reeves intervenes in UK car finance mis-selling case to protect lenders