Upheld: disputed transaction handling, Section 75 Consumer Credit Act claim, credit file reporting complaint against Marks and Spencer Financial Services Plc (trading as M&S Bank)

Decision detail

Summary

Mr A purchased a coat for £1,250 using his M&S Bank credit card in November 2023 but claims he never received it. After the retailer declined a refund, Mr A contacted M&S Bank in May 2024 requesting assistance. M&S Bank requested further information, which Mr A did not provide until January 2026. Based on this evidence, M&S Bank upheld Mr A's Section 75 Consumer Credit Act claim and offered a £1,250 refund plus £100 compensation. Mr A rejected this, seeking removal of adverse credit file entries and refund of all interest paid. The ombudsman upheld the complaint in part, directing M&S Bank to refund the disputed amount and rework the account, but found the default and adverse credit entries were appropriately recorded as the account would have remained in significant arrears regardless.

The Ombudsman's reasoning

The ombudsman found M&S Bank correctly applied chargeback scheme rules by declining to raise a chargeback more than 120 days after delivery. The S75 CCA claim was properly upheld based on evidence provided in January 2026 showing goods were not successfully delivered under Section 29 CRA. However, M&S Bank should have better communicated the reasons for not raising a chargeback and the consequences of not providing further information. The default was appropriately recorded when the account was three months in arrears, and even had the £1,250 been refunded in May 2024, a significant balance of approximately £1,750 would have remained, making default likely. M&S Bank correctly reported accurate information to credit reference agencies and was not obligated to remove adverse entries.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website