Not upheld: account closure, repayment plan terms, credit file reporting complaint against HSBC UK Bank Plc

Decision detail

Summary

Mr E complained that HSBC unfairly closed his credit card account and refused to agree to his proposed repayment plan for the outstanding balance. Mr E had requested a 15-month interest-free repayment period, but HSBC could only offer up to five months at the time. After the FOS Investigator's opinion, HSBC agreed to a longer-term interest-free plan, prompting Mr E to question why this wasn't accepted sooner. The ombudsman found HSBC's initial decline was reasonable as it considered the proposal against its policies, and that the later agreement did not indicate an earlier error. The ombudsman also upheld HSBC's credit file reporting as accurate, given Mr E's failure to make minimum monthly payments as required by the account terms.

The Ombudsman's reasoning

The ombudsman found that HSBC's account terms explicitly allowed interest and charges to continue after account closure, and that minimum monthly payments remained due. HSBC considered Mr E's repayment proposals against its policies at the time and reasonably declined them because it could not offer the 15-month interest-free period requested. The fact that HSBC later agreed to more favourable terms does not mean it was wrong to decline the earlier proposal. Regarding credit file reporting, the ombudsman found this was fair because Mr E failed to make minimum monthly payments as required by the account terms, despite being provided with statements and payment methods.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website