Not upheld: unfair account terms change and withdrawal of free banking promise complaint against Santander UK Plc

Decision detail

Summary

P, a limited company, complained that Santander unfairly migrated its fee-free business account opened in 2008 to a fee-paying account in 2025, despite being promised 'free banking forever'. While the account was marketed with this promise, Santander's terms and conditions throughout the 17+ year relationship contained provisions allowing changes with adequate notice and never guaranteed perpetual free banking. The ombudsman found Santander entitled to make the change as it provided over 60 days' notice as required, the terms and conditions permitted such changes, and significant regulatory changes since 2008 had increased banking costs. The ombudsman also noted Santander was entitled as a commercial business to withdraw uneconomic products and was treating customers fairly by standardising fees.

The Ombudsman's reasoning

The ombudsman found that while the account was marketed as 'free banking forever', the contractual terms and conditions contained provisions allowing Santander to make changes with adequate notice. The terms and conditions never guaranteed free banking forever. Santander provided more than the required 60 days' notice. The ombudsman considered that significant regulatory changes since 2008 had increased banking costs, that free business banking is no longer typical, and that Santander was entitled as a commercial business to withdraw uneconomic products. Even if marketing literature formed part of the contract, Santander could still change it under the terms and conditions. The ombudsman noted P had benefitted from 17+ years of free banking while other customers paid more, and Santander was treating all customers fairly by standardising fees.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website