Upheld: irresponsible lending / unfair overdraft charges complaint against Santander UK Plc
Financial Ombudsman decision DRN-6086503 of 2026-04-02T00:00:00+00:00. irresponsible lending / unfair overdraft charges complaint against Santander UK Plc. Outcome: Upheld.
Decision detail
| Reference | DRN-6086503 |
|---|---|
| Decision date | 2026-04-02T00:00:00+00:00 |
| Firm | Santander UK Plc |
| Product | Overdraft |
| Claim type | irresponsible lending / unfair overdraft charges |
| Outcome | Upheld |
| Remedy | Santander must rework Mr G's overdraft balance to remove all interest, fees and charges added from August 2023 onwards. If a balance remains, Santander should contact Mr G to arrange a suitable repayment plan and record negative information reflecting what would have been recorded had corrective action started in August 2023. If adjustments result in no outstanding balance, any overpayment should be returned to Mr G with 8% simple interest from the date made until settlement, and adverse credit file information should be removed. |
Summary
Mr G complained that Santander continued to allow him to use his overdraft despite his financial difficulties. Mr G had maintained an overdraft since February 2018 with a £1,000 limit since 2021, and by August 2023 showed clear signs of financial difficulty including participation in a debt management plan, significant gambling transactions, and prolonged overdraft usage without meaningful credit balances. Although Santander sent thirteen notifications about his overdraft usage, it failed to take corrective action when these objective indicators suggested the overdraft had become unsustainable. The ombudsman upheld the complaint and ordered Santander to remove all interest, fees and charges from August 2023 onwards and arrange appropriate forbearance.
The Ombudsman's reasoning
The ombudsman found that while Santander's initial approach of sending communications was reasonable, it failed to take corrective action when the situation escalated. The combination of prolonged overdraft usage, DMP participation (an objective indicator of financial difficulty), significant gambling, and absence of credit balances meant Santander ought to have realised the overdraft was unsustainable by August 2023. The ombudsman rejected Santander's argument that Mr G's failure to contact them meant he wasn't in difficulty, noting that consumers may not seek help for various reasons and that Mr G may have feared losing the overdraft facility. Continuing to provide the overdraft in these circumstances caused harm rather than helping Mr G.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Santander UK Plc, all decisions | 14,405 | 22% |
| Overdraft, all decisions | 3,791 | 24% |
Source
Read the original decision on the Financial Ombudsman Service website