Not upheld: irresponsible lending and unfair overdraft increases complaint against Santander UK Plc

Decision detail

Summary

Mrs K complained that Santander continued to increase her overdraft limit from January 2022 onwards when she was frequently using the facility at its limit and incurring unarranged overdraft fees. An investigator upheld the complaint regarding a May 2022 increase, but the ombudsman disagreed. The ombudsman found that Santander's checks based on internal scoring and credit reference agency data were reasonable and proportionate, showing Mrs K's account turnover exceeded each new limit and her external debt was being managed well. Although Mrs K experienced periods of prolonged overdraft usage between August 2023 and April 2025, the ombudsman determined this did not conclusively indicate financial difficulty given her sufficient disposable income and that Santander appropriately monitored the account and contacted her about repeat usage. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied FCA CONC rules requiring proportionate checks and fair lending decisions. The checks Santander conducted were reasonable as they showed Mrs K's account turnover exceeded each new overdraft limit and her external debt was being managed well with no adverse credit information. While Mrs K experienced periods of prolonged overdraft usage, this was not conclusive evidence of financial difficulty. The ombudsman found Mrs K had sufficient disposable income to afford sustainable repayments and that her overdraft usage appeared driven by non-essential spending rather than inability to meet essential commitments. Santander appropriately monitored the account and contacted Mrs K about repeat usage as required by regulations.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website