Not upheld: Direct Debit Guarantee refund claim complaint against Northern Bank Limited trading as Danske Bank

Decision detail

Summary

Mr M complained that Danske Bank should refund direct debit payments he made to a home appliance cover provider under the Direct Debit Guarantee, after he was unable to contact the merchant to make a claim when his dishwasher developed a fault. Danske Bank refused the refund, and the FOS investigator did not uphold the complaint. The ombudsman upheld this decision, finding that Mr M's dispute was a contractual matter with the merchant regarding service accessibility, not an error in the direct debit process itself. The Direct Debit Guarantee only protects against errors such as wrong amounts or incorrect payment dates, not contractual disputes. The complaint was not upheld.

The Ombudsman's reasoning

The Direct Debit Guarantee protects consumers from errors in the direct debit process (wrong amount, wrong date) but does not cover contractual disputes with merchants. Mr M's dispute concerns his inability to contact the merchant to make a claim, which is a contractual matter between him and the merchant, not an error in the direct debit mechanism. Therefore, Danske Bank correctly determined that the claim fell outside the scope of the Direct Debit Guarantee.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website