Not upheld: chargeback handling and dispute resolution complaint against Nationwide Building Society

Decision detail

Summary

Mr W complained that Nationwide Building Society failed to help him recover funds for an all-inclusive holiday where he believed he booked adult-only accommodation but found a child in neighbouring accommodation. Nationwide initially declined to raise a chargeback, but later agreed to do so as a gesture of goodwill after Mr W referred the complaint to the FOS. The ombudsman found that under VISA scheme rules, chargebacks for services not as described are limited to the unused portion of the service, and since Mr W used the accommodation for the full duration of his booking, there was no unused portion to recover. The ombudsman rejected Mr W's arguments that Nationwide should have considered Consumer Rights Act protections and that the correct test was whether the service was as described, concluding that Nationwide handled the dispute fairly and reasonably.

The Ombudsman's reasoning

The ombudsman applied the VISA scheme rules which clearly state that disputed payments for services not as described are limited to the unused portion of the cancelled service. Since Mr W used the accommodation for the full period he booked, there was no unused portion available for recovery via chargeback. Therefore, the chargeback claim had no reasonable prospect of success, making Nationwide's initial decision not to raise it fair and reasonable. The ombudsman rejected Mr W's argument that the correct test was whether the service was as described, noting that even if the service wasn't as described, recovery would still be limited to the unused portion under the scheme rules.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website