Not upheld: Debt collection practices complaint against National Westminster Bank Public Limited Company (NatWest)

Decision detail

Summary

Mr and Mrs C, partners in business H, complained that NatWest unfairly pursued repayment of a £5,000 Bounce Back Loan after H ceased trading in 2021 due to Covid-19. The loan fell into arrears in September 2025 when repayments were due to resume following a repayment holiday. Mr C emailed NatWest on 9 October 2025 asking for clarification on how the loan would be treated, but NatWest did not directly respond to this email, instead continuing with collection procedures and issuing a formal demand in late October 2025. The ombudsman found NatWest acted fairly because the partners were personally liable under the loan terms and partnership law, the BBL Guarantee does not remove repayment obligations, and NatWest's collection process was proportionate. While NatWest could have acknowledged the October email, this did not materially impact the outcome as continued contact provided opportunities for engagement.

The Ombudsman's reasoning

The ombudsman found that under partnership law and the BBL agreement terms, Mr and Mrs C were jointly and severally liable for the loan personally, making it fair for NatWest to pursue them for repayment. The BBL Guarantee does not remove the borrower's obligation to repay; it only protects the lender if they demonstrate reasonable recovery efforts. While NatWest could have acknowledged and directly responded to Mr C's 9 October email, the lack of response did not have material impact because NatWest continued to contact Mr and Mrs C with opportunities to engage, and Mr C could have reasonably followed up given the absence of confirmation.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website