Santander UK Plc · DRN-6104864

The complaint L, a sole trader business, complains Santander UK Plc gave notice in July 2025 that it planned to migrate L’s business account, which is free from fees, to an account which incurs a monthly fee in October 2025. L says this is unfair as, when it opened the account, it was promised it would be entitled to ‘free banking forever’. I’m aware when the account was originally taken out, Santander was trading under a different name. For simplicity I’ve referred to Santander only throughout this decision. L told us: • It opened a business account in 2005. It chose the account on the basis it was offering free banking forever. L believes Santander’s decision to change its trading name didn’t erase this promise. • All of the advertising and documentation L has and remembers from this time confirmed the account would remain fee free for the life of the account subject to relevant changes in law, regulation or the imposition of any tax in connection with bank charges. L believes there have been no such changes communicated or evidenced by Santander and so Santander is acting unfairly now in charging a monthly fee for the account. • The change to the 2015 terms and conditions was not transparent and was done as a deliberate move to cancel the original free for life contract. This change was made quietly and was designed to avoid resistance rather than allow open consultation with loyal customers. • L’s bank account was referenced as a ‘business current account’ and not always as a ‘business everyday account’. And a business current account is a product Santander continues to offer which is at odds with what it told L about no longer offering this type of account any longer. • Other banks currently offer free business banking and Santander’s accounts need to be competitively viable. • L has had to move its banking elsewhere causing considerable inconvenience. • If Santander was always allowed to change its rules retrospectively then the way the account was initially advertised was unfair - L would have made different decisions if it had been fairly advertised. Santander told us: • Whilst it accepts that the account taken out by L was marketed as free banking forever, this has never been included in the terms and conditions of the account.

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• Over the years, Santander has needed to review the products it is able to offer its customers and, as part of simplifying the accounts available, it has migrated certain accounts to new products. In 2015, L’s account was migrated to an ‘everyday account’ which has no promise of fee free banking. More recently, it needed to migrate some customers to a new account, and this is also an account with no promise of fee free banking. • Santander is satisfied banking services have changed in the years since L’s account was opened – around 20 years ago - and there have been changes in the relevant law and regulation. This has resulted in a need to change the way it operates business accounts which justifies a fee being charged. • To ensure it’s providing a fair and consistent service to all its customers, Santander is simplifying its business account range by consolidating existing business accounts to the ‘classic’ account which comes with a fee of £9.99 per month. Many of those customers migrating to the classic account have not benefitted from fee free banking for the past 20 years, and most of the products it’s migrating have a monthly fee of more than £9.99 per month. • It’s satisfied the implementation of a monthly fee is supported by the terms and conditions and it has given L adequate notice of the intended change. L’s choices are to move to the new account with a monthly fee, close the account, or switch to a new provider which Santander said it will facilitate. Our Investigator looked into things but didn’t uphold the complaint. L didn’t accept the Investigator’s findings so the complaint was passed to me for a decision. After reviewing the evidence, I was minded to reach the same outcome as the Investigator but for different reasons. So, I issued a provisional decision so that both parties had the opportunity to respond before a final decision was made. Santander made no further representations. L disagreed with the outcome as it did not believe Santander’s actions were fair, even if they were legally permissible. It raised a number of points, including asking for my position on whether the 2005 terms and conditions allowed Santander to withdraw this product in the way it did, particularly in light of the fact it thinks the change in the 2015 terms and conditions was unfair. So I’m now in a position to issue a final decision on this complaint. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. I’ve carefully read all of the correspondence both parties have sent this Service, including L’s response to my provisional decision. That being said, my decision won’t address every point or comment raised. I mean no discourtesy by this, it simply reflects the fact our Service is an informal dispute resolution service, set up as a free alternative to the courts. So, in deciding this complaint I’ve focussed on what I consider to be the key issues. There’s no dispute here the marketing information for L’s account when it was opened set out that Santander was offering free banking forever. It’s clear this was how the account was advertised and I’ve seen the literature from the time that supports this. I’d add that Santander isn’t disputing this either. So, I accept what L has said about what it was told in some of the literature linked to the account when it was opened.

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The issue for me to decide here is whether I think Santander is acting unfairly in migrating L to the new account now, taking into account the terms and conditions applicable to L’s account. The terms and conditions applicable to the account when L opened it say: “5.1.1 We may change these Conditions (which includes adding or removing conditions) by notifying you of the change.” I’ve also reviewed all the subsequent versions of the applicable terms and conditions available throughout the years, from the time the account was opened until the most recent version. I can see they all contain the same, or similar, wording that allowed changes to be made. So, for around 20 years, Santander has been clear in the applicable terms and conditions - changes can be made to the account, and none provided a guarantee of free banking forever. Despite this, L has benefitted from free business banking for around 20 years. In saying this I acknowledge L feels the term ‘benefit’ unfairly reframes Santander’s promise as generosity, but I’m satisfied that having a fee free account has been of benefit to L. So, I don’t think this is an unreasonable observation to make. Overall, I think it’s fair and reasonable that Santander is relying on the terms and conditions and making these changes. The other relevant terms and conditions to consider as it’s making these changes now are the most recent. In 2015, Santander migrated L’s account to a Santander branded ‘Everyday Current Account’ and Santander’s general terms and conditions applied from this point onwards. They provide a list of changes Santander might make, which include taking into account changes in costs and regulation. Whilst L has emphasised that the 2015 change in the terms and conditions wasn’t transparent and was done in a deliberate move to cancel the free for life contract, as I’ve outlined above, I’m satisfied Santander has always been allowed to change the terms and conditions and that these have never stipulated the account would be fee free forever. The 2015 terms and conditions were updated in April 2025 and state: “This agreement may last for a long time, so we’re likely to need to make changes to it from time to time. We might change these terms or your account’s specific conditions. This includes interest rates or fees (such as adding or removing fees)…” So, I’m satisfied the terms and conditions currently applicable to L’s account allow Santander to make changes to it subject to giving sufficient notice of this to its customers. The terms and conditions set out that Santander should give 60 days’ notice of this change, and I can see it gave L slightly more than this, so it’s provided the notice required. I appreciate L wants me to provide an opinion on whether the 2005 terms and conditions would have allowed Santander to withdraw this product, but I can’t see that this is a relevant finding for me to make. These terms and conditions weren’t in place at the point Santander withdrew this product. And I’m satisfied Santander was entitled to update the terms and conditions of the account as outlined above.

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L feels strongly that literature outside of the terms and conditions formed part of Santander’s obligations to it. And I have considered this point, and the literature, carefully. But the terms and conditions are what outline the contractual obligations between Santander and its customer. Even if the other literature did form part of the contractual agreement L had with Santander, it would still be able to change this agreement under the terms and conditions outlined above. I’m also satisfied this change is supported by the literature I’ve seen that would’ve been given to L when the account was opened. The tariff of charges provided to customers opening the account in 2005 is titled ‘free banking forever’, but the literature goes on to explain this is subject to relevant changes to the law, regulation or the imposition of any tax in connections with bank charges. And there have been significant changes to banking regulation since 2005, for example, the obligations on banks to better protect its customers from various risks including anti-money laundering, countering the financing of terrorism, and preventing fraud and scams, significantly increasing the costs of offering an account to both personal and business customers. I appreciate Santander hasn’t explicitly outlined the costs associated with these changes to L, but it’s not required to. Free business banking is not currently a typical offering from most major retail banks. And in Santander’s case it’s aware that whilst some customers, like L, have benefitted from fee free banking for around 20 years, others have been paying significantly more. Santander has said it’s taking this step to ensure all its customers are being treated fairly, and I haven’t found it’s acting unfairly in asking L to pay a fee in this case. It might help L if I explain it’s not my role to regulate banks, that’s for the Financial Conduct Authority (FCA), so I wouldn’t comment on whether Santander’s offering is competitively viable. As a commercial business Santander is entitled to make decisions about products that are no longer commercially viable, including withdrawing them completely. In this case, it explained the decision is that it will no longer offer the account L currently has. This is a decision it’s entitled to make and one which this Service wouldn’t typically interfere with. So, even if there had been a contractual obligation to always provide the account with no fees attached, I wouldn’t have likely concluded it would be fair that Santander should be obligated to provide this product to L indefinitely if it believed it was uneconomic to do so. I have thought about L’s evidence indicating its account was referenced as a ‘business current account’ and not always as a ‘business everyday account’. Santander has explained that its internal product catalogue has three structural levels: the platform, product family and specific product type. It explained that ‘business current accounts’ is a product family under which sits the specific product. And that in some communications it might refer to the product family, not necessarily the specific product. I think this is what has happened here. Ultimately, I’m satisfied Santander is removing L’s product from the market and that it’s entitled to do so. Santander offered L a reasonable alternative account, albeit with a fee, and it gave L enough notice of the changes so it could find alternative options should it wish to. I would also note the terms and conditions allow Santander to close the account as long as sufficient notice is given. I understand L feels Santander has broken its promise. But overall, I’m satisfied it’s entitled to change the terms and conditions applicable to the account – including in relation to the cost of the account - as long as sufficient notice has been provided, as it has in this case. I note L’s comments about the initial advertisement being unfair if Santander was always able to amend its terms and conditions. Even if I accepted L was misled around 20 years

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ago, the remedy would be to put L in the position it would have been in had it known the promise would last around 20 years, rather than “forever”. It seems to me that even if L had known the free banking would end 20 years after opening the account, its position would still be the same now. I say this because L’s options at the time would have been to still take the Santander account, or find an alternative account that would provide free banking forever and I have seen no evidence that it would have been likely that L would have found another account in 2005 that would still be offering free banking now. In any case, even if L could have found such an alternative account, I do not agree that this is a case of mis-selling or misleading advertising. This is because there was no misrepresentation or mis-selling when L opened the account; it got what it expected: a business account that did not charge fees for everyday banking. The issue is that Santander has decided it can no longer offer that account with free business banking. As set out above, I think it is entitled to make that decision. My final decision My final decision is that I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask L to accept or reject my decision before 17 April 2026. Jade Cunningham Ombudsman

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