Partially upheld: Persistent overdraft use complaint against Santander UK plc
Financial Ombudsman decision DRN-6455035 of 2026-06-25T00:00:00+00:00. Persistent overdraft use complaint against Santander UK plc. Outcome: Partially upheld.
Decision detail
| Reference | DRN-6455035 |
|---|---|
| Decision date | 2026-06-25T00:00:00+00:00 |
| Firm | Santander UK plc |
| Product | Overdraft |
| Claim type | Persistent overdraft use |
| Outcome | Partially upheld |
| Remedy | Santander must rework Miss L's overdraft balance to remove all interest, fees and charges applied from September 2023 onwards. If a balance remains, Santander should arrange a suitable repayment plan and may record negative information backdated to September 2023. If removing charges results in no outstanding balance, any overpayment should be returned to Miss L with 8% simple interest from the date made, and adverse information should be removed from her credit file. |
Summary
Miss L complained that Santander UK plc irresponsibly allowed her to increase her overdraft limit despite it being unaffordable. Her overdraft grew from £1,200 in February 2015 to £3,050 by February 2023. The ombudsman found that while the limit increases between December 2021 and February 2023 were based on proportionate checks and fair lending decisions, Santander acted unfairly when renewing the overdraft in September 2023. By that point, Miss L had been persistently overdrawn since February 2022, earned only approximately £1,200 monthly, and carried over £31,000 in external debt, yet Santander's monitoring failed to identify these signs of financial difficulty. The ombudsman ordered Santander to remove all interest, fees and charges applied from September 2023 onwards and return any overpayments with interest.
The Ombudsman's reasoning
The ombudsman found that while Santander's checks for the limit increases between December 2021 and February 2023 were proportionate and the lending decisions were fair based on available data at those times, Santander acted unfairly when renewing the overdraft in September 2023. By that point, there was a clear disconnect between Santander's CATO data showing healthy account turnover and the reality that Miss L had been persistently overdrawn since February 2022, earning only around £1,200 monthly against a £3,050 limit, with significant external debt. This should have triggered a more in-depth review and intervention under CONC regulations. The overdraft facility became unsustainable, and Miss L was locked into paying charges and interest with no reasonable prospect of repayment.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Santander UK plc, all decisions | 14,502 | 22% |
| Persistent overdraft use, all decisions | 1,152 | 15% |
| Overdraft, all decisions | 3,695 | 24% |
Source
Read the original decision on the Financial Ombudsman Service website