Upheld: failure to notify customer of payment processing changes and delays complaint against Zilch Technology Limited

Decision detail

Summary

Mr M complained that Zilch did not inform him about issues with a third-party payment processor (T) that caused payment delays. In September and October 2025, Mr M attempted to make payments via T that either failed or took longer than expected to process. Zilch acknowledged the issues in October but had not previously notified Mr M. The ombudsman found that under the FCA Consumer Duty, Zilch should have informed Mr M of the payment processing delays before he made payments. The failure to communicate caused Mr M distress and concern about missed payments. The ombudsman upheld the complaint and ordered Zilch to pay £50 compensation.

The Ombudsman's reasoning

The ombudsman found that Zilch was aware of payment processing delays with the third-party provider but failed to inform Mr M before he made payments. Under the FCA Consumer Duty, businesses must inform customers of changes affecting the service they receive. The lack of notification directly impacted Mr M's experience, causing him to be unaware that payments could take three to five business days, leading to concern about missed payments and potential account restrictions. This failure to communicate was unreasonable and caused distress and inconvenience.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website