Not upheld: Account administration errors complaint against Santander UK Plc

Decision detail

Summary

Mr M, a sole trader, complained that Santander unfairly migrated his free business account opened in 2009 to a fee-paying account charging £9.99 monthly, despite being promised 'free banking forever' in the original marketing. Santander argued the promise was never included in the contractual terms and conditions, which have consistently allowed changes with notice, and that it provided over 60 days' notice as required. The ombudsman found that while the marketing literature did promise free banking forever, the contractual terms and conditions are the binding obligations and have always permitted changes. The ombudsman concluded Santander acted fairly in relying on these terms and conditions and was entitled to consolidate its account range as a commercial decision, particularly given that free business banking is not typical among major retail banks.

The Ombudsman's reasoning

The ombudsman found that while the marketing literature promised free banking forever, the contractual terms and conditions have consistently allowed Santander to make changes with notice. The terms and conditions are the binding contractual obligations, not the marketing literature. Santander provided adequate notice (over 60 days) as required. As a commercial business, Santander is entitled to make decisions about uneconomic products and consolidate its account range. The ombudsman noted that free business banking is not typical among major retail banks and that Santander was treating customers fairly by standardising fees across its customer base.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website