Not upheld: unfair charges / unilateral variation of contract terms complaint against Santander UK PLC

Decision detail

Summary

Mr T complained that Santander introduced a £9.99 monthly charge for his business account in 2025, despite being promised free banking forever when he opened the account in 2007. Santander argued it was contractually entitled to make the change under Clause 14 of the account terms and conditions, which permitted variations including fees. The Ombudsman found that the account terms and conditions (not promotional materials) governed the relationship, that Clause 14 expressly allowed fee changes, and that significant regulatory changes since 2007 justified the fee. The complaint was not upheld as Santander had acted fairly and reasonably within its contractual rights.

The Ombudsman's reasoning

The Ombudsman found that while marketing materials promised free banking forever, the account terms and conditions (which govern the relationship) contained Clause 14 allowing Santander to make changes to the agreement including fees. The promotional material also contained qualifying language such as 'unless there are any changes to the law or banking regulations'. Significant regulatory changes since 2007 have substantially increased the costs of providing banking services. Santander provided three months' notice (exceeding the required two months) and clearly set out Mr T's options. The Ombudsman concluded this was a commercial decision Santander was entitled to make and that Mr T had benefitted from 18 years of free banking.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website