Not upheld: failed direct debit collection and credit file reporting complaint against Barclays Bank UK PLC trading as Tesco Bank

Decision detail

Summary

Mr G complained that Tesco Bank failed to collect his monthly direct debit payment and incorrectly recorded a late payment marker on his credit file. On 7 September 2025, Mr G amended his direct debit instruction via the mobile app from the minimum amount to the full statement balance, which resulted in the existing direct debit mandate becoming uncollectable and the new mandate not being active until the next statement period. Tesco Bank displayed two warnings to Mr G during the amendment process informing him that he needed to make a manual payment by the due date. When Mr G failed to make the payment, a late payment fee was applied and a marker was recorded on his credit file. The ombudsman found that Tesco Bank had not made an error and that the warnings provided were adequate, making Mr G responsible for the missed payment. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that although Mr G did not intend to cancel his existing direct debit, the effect of amending the instruction was that the existing mandate would no longer be collectable. The mobile app screenshots demonstrated that Tesco Bank provided two reasonable warnings: one before the amendment stating that changes may not be in place in time and a minimum payment must be made by the due date, and one after submission stating the direct debit would not be in place until the next statement and asking if Mr G wanted to make a payment. The ombudsman was satisfied these warnings adequately informed Mr G of his obligation to make a manual payment. Regarding the credit file marker, the ombudsman noted that lenders are obliged to report accurate information and the service can only request amendments where there is clear evidence of error, which did not exist in this case.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website