Upheld: Card / payment disputes complaint against Santander UK Plc

Decision detail

Summary

Mr V purchased flight tickets for £111.98 from a travel agent using his Santander credit card in April 2024. The airline cancelled the first leg of the flight scheduled for 29 December 2024, and Mr V was unable to obtain a refund from either the supplier or airline. When Mr V raised a dispute with Santander in January 2025, Santander declined both a chargeback and Section 75 claim, arguing the debtor-creditor-supplier chain was broken. The ombudsman upheld the complaint, finding that Santander should have raised a chargeback for service not provided, as it had sufficient information by mid-February 2025 and the airline's cancellation (rather than a customer-initiated cancellation) is not subject to non-refundable booking terms. Santander was directed to refund £111.98 plus 8% interest from 1 April 2025.

The Ombudsman's reasoning

The ombudsman found that Santander should have raised a chargeback under the 'Goods or Services Not Provided' reason code because: (1) Mr V provided sufficient information by 17 December 2024 and supporting documents by 14 January 2025; (2) Santander had until 27 April 2025 to raise the chargeback (120 days from the anticipated performance date of 29 December 2024); (3) the airline's cancellation of the service constitutes a service not provided, which is distinct from a customer-initiated cancellation and therefore not subject to non-refundable booking terms; (4) under Mastercard guidance, the travel agent (supplier) is the merchant of record responsible for defending the chargeback claim; (5) the chargeback would more likely than not have succeeded; and (6) Santander's delay in requesting additional information in April 2025 was unreasonable given it already possessed the necessary documents.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website