Upheld: Service failures generally complaint against Hampshire Trust Bank Plc

Decision detail

Summary

Mr N complained that Hampshire Trust Bank prevented him from accessing his savings account by implementing mandatory two-factor authentication via mobile phone only, despite Mr N not having a mobile phone. HTB provided no alternative authentication methods and only notified customers via its website, not directly. Mr N missed a credit card payment and would need to move funds to a lower-interest account elsewhere to maintain online access. The ombudsman upheld the complaint, finding HTB's approach violated FCA guidance requiring firms to provide multiple authentication methods including non-mobile options, and that existing customers should not be expected to check websites for wholesale account changes. HTB was ordered to pay £200 compensation for distress and inconvenience.

The Ombudsman's reasoning

The ombudsman found HTB's approach unfair and unreasonable despite HTB's argument that PSR rules on Strong Customer Authentication do not apply to savings accounts. The ombudsman cited FCA guidance explicitly requiring firms to develop SCA solutions that work for all consumer groups, including those without mobile phones, and to provide multiple authentication methods. The ombudsman noted that while HTB complied with its terms and conditions by posting changes on its website, an existing customer would not reasonably be expected to check the website for wholesale changes to account functionality. The ombudsman concluded Mr N suffered clear distress and inconvenience through loss of account access, a missed payment, and the need to move funds to a lower-interest account.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website