Not upheld: account administration, default recording, and debt collection procedures complaint against NATIONAL WESTMINSTER BANK PUBLIC LIMITED COMPANY (NatWest)

Decision detail

Summary

Mrs A complained about NatWest's handling of her current account with an arranged overdraft, specifically the recording of a default and transfer of her debt to a collection agency. Mrs A disclosed in July 2025 that health conditions had prevented her from engaging with the bank and managing her account. NatWest had made the account dormant due to overdraft charges, but reactivated it in June 2024 after Mrs A contacted it, refunded charges, and offered support. When Mrs A made no further payments or meaningful engagement despite correspondence sent in April, May, December 2024 and January 2025, NatWest terminated the account and registered a default in March 2025. The ombudsman found NatWest acted fairly because it was not aware of Mrs A's health vulnerabilities until her complaint in July 2025, and therefore assessed fairness based on information available at the time of its actions.

The Ombudsman's reasoning

The ombudsman determined that fairness must be assessed based on information available to NatWest at the time of its actions, not information disclosed later. While Mrs A was experiencing financial difficulties disclosed in June 2024, NatWest offered appropriate support and explained consequences. The ombudsman found no clear evidence that NatWest was aware of Mrs A's health vulnerabilities prior to the default, and therefore NatWest was not obligated to identify vulnerability indicators from circumstances alone or take additional tailored action. NatWest provided multiple opportunities for engagement through correspondence and followed its terms and conditions in transferring the debt.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website