Not upheld: unfair contract variation and terms and conditions change complaint against Santander UK Plc

Decision detail

Summary

W, a limited company, complained that Santander unfairly introduced a £9.99 monthly fee to its business account in 2025, despite the account being marketed as 'free banking forever' when opened in 2005. W argued this breached the original agreement and that it did not agree to 2015 terms and conditions changes that removed the 'free forever' guarantee. Santander argued that while the account was marketed as free, the formal terms and conditions have always allowed changes with notice, and significant regulatory changes since 2005 justified the fee. The ombudsman did not uphold the complaint, finding that the formal terms and conditions, not the marketing literature, constitute the binding contract, and Santander was entitled to make changes with adequate notice and to withdraw uneconomic products.

The Ombudsman's reasoning

The ombudsman found that while the marketing literature promised 'free banking forever', the formal terms and conditions have consistently allowed Santander to make changes by providing notice. The terms and conditions are the binding contractual obligations, not the marketing literature. Santander provided adequate notice (over 60 days) as required. Significant regulatory changes since 2005 have increased banking costs, justifying the fee. As a commercial business, Santander is entitled to withdraw uneconomic products. The ombudsman would not interfere with commercial product decisions even if a contractual obligation existed.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website