Not upheld: unfair account terms change and fee introduction complaint against Santander UK Plc

Decision detail

Summary

R, a limited company, complained that Santander unfairly migrated its free business banking account to a new account with a £9.99 monthly fee in 2025, despite being promised 'free banking forever' when opening the account in 2005. Although the ombudsman acknowledged the marketing promise, the contractual terms and conditions had consistently allowed Santander to make changes with notice throughout the 20-year period. Santander provided over 60 days' notice as required and was entitled as a commercial business to consolidate its account range and introduce fees to reflect increased regulatory compliance costs since 2005. The ombudsman found Santander had acted fairly and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that while the marketing material did promise free banking forever, the contractual terms and conditions have consistently allowed Santander to make changes by providing notice. The terms and conditions have contained change clauses for the entire 20-year period. Santander provided the required 60+ days' notice and the letter was properly addressed. The ombudsman considered that as a commercial business, Santander is entitled to withdraw uneconomic products and consolidate its account range. Regulatory changes since 2005 have increased compliance costs. The ombudsman noted that even if marketing material formed part of the contract, Santander could still change it under the terms and conditions. The decision to introduce fees in 2025 was not affected by Santander's decision not to do so in 2012.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website