Banking Disputes: Your Rights and How to Win

Current accounts, savings, credit cards, personal loans and BNPL. Your rights, the FOS route, and how to get your money back.

Financial Ombudsman Service (FOS)

5 sub-sectors covered

Banks lose more complaints than they admit. In the year to March 2025 the Financial Ombudsman Service upheld 34 per cent of all the complaints it resolved, and that figure only captures the complaints that made it through eight weeks of internal handling. The FOS received 305,726 new complaints in 2024/25, the highest level for six years, with hire purchase motor finance, credit cards and current accounts the most-complained-about products. The cases that drop out earlier, where the bank's first or second response talks the customer out of escalating, are larger in number and uncounted.

The pattern is the same across current accounts, credit cards, BNPL, savings and personal loans. The bank issues a templated rejection. The customer chases. The customer escalates. A senior reviewer rewords the rejection. After eight weeks, the customer refers the matter to the Financial Ombudsman. Three to twelve months later, the FOS issues a view, and a meaningful minority of those views are favourable.

The banks that change behaviour are the ones that realise the customer knows the rules. The customer who cites DISP 1.6.2 by reference, who quotes the bank's own contemporaneous internal note from a Subject Access Request, who calculates the redress against the FOS's own published methodology, lands on a different desk inside the bank from the one that handled the initial response.

Key Legislation

Consumer Credit Act 1974 (including s.75 and s.140A)
Payment Services Regulations 2017
Consumer Rights Act 2015 (ss.62 and 68)
FCA Handbook: BCOBS, CONC, DISP
FCA Consumer Duty (PRIN 2A)

Complaint Route

Financial Ombudsman Service (FOS)

Always complain to the company directly first. Give them 8 weeks to respond. If unresolved, escalate to the relevant ombudsman or ADR scheme listed above. EvenStance guides you through every step.

The most common banking disputes

Current accounts. Unfair charges, refused transfers, account closures without notice, frozen accounts during fraud investigations that go on far longer than the FCA's BCOBS standards allow. The key reference is the Banking: Conduct of Business sourcebook (BCOBS), particularly BCOBS 2 (communications), BCOBS 4 (cancellation rights), and BCOBS 5 (post-sale rules including prompt-action obligations on payments and complaints). Closures must be reasonable on the facts and notified with reasonable notice; closures without notice for commercial reasons routinely fall short of that standard.

Savings. Rate notifications missed, transfers delayed beyond the statutory window, accounts left to drift on legacy rates while the customer was not informed of better alternatives the bank itself offered. Banks have an obligation under PRIN 2A (the Consumer Duty) to deliver fair value, which makes long-running inertia on a legacy rate harder for the bank to defend than it used to be.

Credit cards. Two strong statutes. Section 75 of the Consumer Credit Act 1974 makes the card issuer jointly and severally liable with the merchant for purchases between £100 and £30,000 where there is a misrepresentation or breach of contract. Section 140A allows the court (or, indirectly, the FOS) to reopen an unfair credit relationship. Most consumers underuse both. The card issuer's first move is to argue the dispute is between you and the merchant; that is wrong on s.75 and is the single most common card-dispute fob-off.

Personal loans. Affordability disputes under CONC 5 (the FCA's Consumer Credit Sourcebook on responsible lending). The lender must have undertaken a creditworthiness assessment that takes account of the consumer's financial position; if it did not, or if the assessment was clearly inadequate against the figures, the agreement may be unfair within s.140A. Early settlement under s.94 of the CCA gives the consumer the right to settle at any time with a statutory rebate; lenders sometimes obstruct this by quoting inflated settlement figures.

BNPL (buy-now-pay-later). Currently outside full FCA regulation as at May 2026, but on a confirmed path to it. Treasury secondary legislation passed on 14th July 2025 brings Deferred Payment Credit under FCA regulation from 15th July 2026. A temporary permissions regime is open between 15th May 2026 and 1st July 2026. Until 15th July 2026, the strongest routes for a BNPL dispute are chargeback through the underlying card, s.75 where the BNPL plan was funded by a credit card, and a direct complaint to the BNPL provider citing the Consumer Duty (where the provider holds related FCA permissions).

The first fob-off and the rebuttal that works

The bank's first response will do some combination of three things. It will restate the complaint as a narrower point than the customer raised, so the rejection can knock down a different argument. It will fall back on the signed agreement or the standard terms. It will say the bank acted in accordance with our policy.

When the bank restates the complaint, the chaser names the actual complaint in numbered paragraphs with the supporting documents. When the bank cites the signed agreement, the chaser cites the rule that overrides it: section 62 of the Consumer Rights Act 2015 makes unfair contract terms unenforceable, section 68 makes non-transparent terms unenforceable, and BCOBS, CONC and the Consumer Duty sit above the contract. When the bank cites policy, ask for the policy. If the policy is consistent with the regulatory rules and the bank followed it, that is a defence; if the policy is not produced, or if the policy itself fails the rules, the citation collapses.

One specific pattern recurs and is worth flagging. Some banks issue a Final Response Letter dated before the events the FRL is responding to could have occurred. I ran a complaint on behalf of a vulnerable account holder where the bank's FRL was dated before the Court of Protection Order under which I had authority to act for the customer had been granted. The bank cannot lawfully have been responding to my complaint on a date before I had standing to make one. The chronological impossibility was decisive at the FOS. The general lesson: check the dates on every piece of correspondence the bank sends. Inconsistencies are evidence.

Escalation path

The escalation route for FCA-regulated banking disputes is the Financial Ombudsman Service. The procedural framework is set out in DISP (the Dispute Resolution Sourcebook) in the FCA Handbook. The key rule for consumers is DISP 1.6.2R: a firm must, by the end of eight weeks after receiving a complaint, send the complainant a final response or a written response explaining why it is not in a position to give one and indicating when the complainant may refer the complaint to the FOS. After eight weeks, whether the firm has responded or not, the complainant may refer the matter to the FOS as of right.

The FOS will not investigate a complaint until either a final response has been issued or eight weeks have passed. Once the consumer can refer, the time limit is six months from the final response.

Award limits. For complaints referred from 1st April 2026, about acts or omissions on or after 1st April 2019, the maximum binding award is £455,000. For complaints referred from the same date about earlier acts, the limit is £205,000. The limits are uplifted annually in line with CPI inflation. The FOS can recommend a higher figure where it considers it fair, but the recommendation above the cap is not binding.

What the FOS looks for in a strong complaint: documentary evidence over narrative, a clean chronology, specific FCA Handbook references rather than general assertions of unfairness, quantified loss with a calculation, engagement with the bank's most plausible defence in advance rather than in reaction.

What it costs and how long it takes

The FOS is free to consumers. The bank pays a case fee to the FOS for each case that reaches investigation; the case fee is part of the bank's regulatory cost base and not recoverable from the consumer.

FOS average case-handling time reduced to just under three months by the end of 2023/24, with the service targeting 90 per cent of cases resolved within six months. Motor finance hire purchase has been the exception: some consumers have been waiting close to two and a half years for a response, which is why the FCA extended its temporary complaint handling rules for those agreements until 31st May 2026. Current account, credit card and consumer credit complaints outside motor finance tend to resolve in three to six months from FOS referral.

Awards data is in the FOS published decisions database. The database is searchable by product and is the strongest source for benchmarking what the FOS has awarded in cases similar to yours. Use it before deciding whether to accept a bank's offer.

How EvenStance helps with banking disputes

Frank's banking flow drafts the formal complaint with the correct BCOBS, CONC, or s.75 reference for the dispute type, tracks the eight-week DISP clock against the bank's response, and prepares the FOS submission with the regulatory grounds front-loaded. The platform's Subject Access Request flow generates the SAR to extract the bank's contemporaneous internal notes, the audit trail of the complaint handling, and any flags the bank has applied to the account.

For section 75 disputes, Frank handles the joint-liability point directly, identifies whether the spending pattern engages the £100 to £30,000 threshold, and produces the parallel claim to both the merchant and the card issuer.

Sub-sectors Covered

Banking - Current AccountsBanking - Savings AccountsCredit CardsPersonal LoansBNPL (Buy-Now-Pay-Later)

Frequently Asked Questions

Can I complain to the FOS if my bank account has been closed without notice?

Yes. Account closures must comply with the Banking: Conduct of Business sourcebook (BCOBS) and with the terms of your account agreement. A closure without reasonable notice, or for a reason the bank will not give, is the kind of complaint the FOS regularly upholds. The award typically includes financial loss caused by the closure (replacement direct debit costs, missed payments, knock-on credit-file damage) plus distress. Complain to the bank in writing first; refer to the FOS after eight weeks or sooner on receipt of a Final Response Letter.

My credit card refused a section 75 claim. What now?

Section 75 of the Consumer Credit Act 1974 makes the card issuer jointly and severally liable with the merchant. A refusal on the basis that this is between you and the merchant misstates the law. Write back citing s.75 by reference, state the price was between £100 and £30,000, that the purchase was made on credit (not debit), and quantify the misrepresentation or breach. Escalate to the FOS at the eight-week mark if the card issuer maintains the refusal.

I was sold a loan I could not afford. Do I have a claim?

Possibly. The Consumer Credit Sourcebook (CONC), specifically CONC 5, requires lenders to undertake a creditworthiness assessment proportionate to the loan and the borrower's circumstances. Where that assessment was clearly inadequate, the agreement may be an unfair credit relationship under s.140A of the Consumer Credit Act 1974. The FOS regularly upholds affordability complaints and orders refunds of interest and fees. Gather your bank statements from the loan period to evidence what the lender should have seen.

What is the deadline for complaining about a banking issue from years ago?

Two clocks. The bank's internal limit is typically six years from the event or three years from when you reasonably should have known about it (the FOS rule mirrors limitation principles). The court limitation period for breach of contract is six years from the breach under section 5 of the Limitation Act 1980. If you are inside the FOS time limits, the bank cannot lawfully refuse to consider the complaint on age alone.

What is the FOS award limit now?

For complaints referred to the FOS from 1st April 2026 about acts on or after 1st April 2019, the maximum binding award is £455,000. For complaints referred from the same date about acts before 1st April 2019, the limit is £205,000. The limits are uplifted annually in line with CPI.