Lloyds Bank PLC · DRN-6148375

The complaint Mr and Mrs W complain about the service the received from Lloyds Bank PLC in relation to their current account and overdraft. What happened The background to this complaint is well known to both parties, so I won’t repeat it at length here. As a summary, Mr and Mrs W hold a current account with an overdraft facility with Lloyds. In March 2025, Mr W realised they had an upcoming direct debit that would take their account beyond its agreed overdraft limit. Mr W transferred funds from an account held with another provider; however, was concerned the funds wouldn’t reach the account before the direct debit was due to be taken. Mr W therefore looked to temporarily increase his overdraft limit. Lloyds declined this when Mr W applied online and didn’t change its answer when he called to discuss the matter. On the day the direct debit was due to be taken, Mr W asked Lloyds if it could delay when the payment would be taken, to allow longer for the funds he’d transferred to reach his account. Lloyds however said this was automated, so it couldn’t change when the payment would be attempted. Mr W then received the transferred funds into another Lloyds account that afternoon. He tried to make a transfer to the current account the direct debit was due to be taken from. Lloyds flagged this transaction for further checks. Mr W completed these checks, and the funds were successfully transferred to his current account, meaning the direct debit was taken without issue. Unhappy with the service he’d received, Mr W complained. He said he and Mrs W had been customers of Lloyds for many years and couldn’t understand why it wouldn’t agree to a temporary overdraft increase. He was also unhappy Lloyds had blocked the transfer from his savings to current account. Mr W said Lloyds’ actions had caused avoidable upset and distress. Overall, Lloyds doesn’t agree it’s done anything wrong. It says the application to increase the overdraft limit was correctly declined in line with its lending policies. In relation to the restriction placed on the transfer, it again said this was in line with its risk policies and such checks were to protect its customers. While Lloyds didn’t agree it had done anything wrong in relation to managing the account it offered £50 to acknowledge a delay in responding to Mr and Mrs W’s complaint. Mr and Mrs W didn’t accept Lloyds’ response, so referred their complaint to the Financial Ombudsman. One of our Investigator’s looked into things and thought Lloyds’ response was reasonable so didn’t recommend it do anything further. Mr and Mrs W disagreed with our Investigators opinion. They said there had been numerous customer service failings and Lloyds should pay further compensation to acknowledge this.

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As the matter wasn’t resolved, the complaint has been passed to me to decide. 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 want to acknowledge that I’ve summarised the events of the complaint. I don’t intend any discourtesy by this – it just reflects the informal nature of our service. I want to assure Mr and Mrs W and Lloyds that I’ve reviewed everything on file, alongside taking into consideration the relevant rules and regulations applicable to this complaint. And if I don’t comment on something, it’s not because I haven’t considered it. It’s because I’ve concentrated on what I think are the key issues. Our powers allow me to do this. Having considered all the information, while I can understand why Mr and Mrs W are unhappy and consider their requests reasonable as long-standing customers of Lloyds, I haven’t found that the bank did anything wrong. I realise this answer may come as a disappointment and I’ve explained why I’ve reached this conclusion below. Starting with Mr and Mrs W’s request to temporarily increase their overdraft. Lloyds, like many financial firms has moved to automate a number of its lending decisions, meaning it isn’t always possible for these to be overridden by individuals of the bank. Lloyds has shown that it considered Mr and Mrs W’s request to increase their arranged overdraft limit in line with its lending policies, however this was outside the risk profile of the bank. It isn’t for me to tell Lloyds what its lending policies should be, this is a decision the bank itself it entitled to make. And in doing so, I’m satisfied that Lloyds has acted fairly, in that it applied the same parameters to considering Mr and Mrs W’s request as it would have for other customers. So, while I appreciate Mr and Mrs W are frustrated by the declined application, particularly considering they only wanted it for a short amount of time, I don’t find Lloyds was unreasonable in the decision it made. Following this, on the day the direct debit was due, Mr W spoke with Lloyds about delaying the time it processed the direct debit to allow more time for the funds to reach the account. I understand it would have again been frustrating to be told this wasn’t possible. However, as this is also an automated process, I don’t find it was unreasonable for Lloyds to explain it wasn’t able to complete Mr W’s request. The funds were then received into another account Mr and Mrs W held with Lloyds. Mr W requested to transfer the funds from that account to the current account the direct debit was due to be taken from. Due to the size of the transaction and that the funds were being moved shortly after entering the first account, this flagged on Lloyds’ systems for further fraud prevention checks. Again, I can understand why Mr W was frustrated by this; from his point of view, it was clear what the transfer was for, and it was between two accounts in the same names. However, Lloyds like all banks is expected to have robust fraud prevention measures in place and I don’t find it at fault for wanting to ask further questions before completing the transfer. The sum was for a significant amount and although the funds were being moved between two accounts held by Mr and Mrs W, if the transfer wasn’t legitimate, once the funds had been moved out of the account they’d originally been received into, it can make it significantly more difficult to then retrieve these funds. So, I don’t find Lloyds at fault for

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asking further questions before completing the transfer. This was again carried out in line with the banks policies. The funds ultimately reached Mr and Mrs W’s account in time for the direct debit to be successfully completed, so they didn’t suffer a loss on this point. I can understand why they found the process frustrating, for what seemed like a simple request of support from their bank to ensure a direct debit cleared, it would have felt like they faced a number of hurdles. While I appreciate this would have been frustrating and at times distressing, I haven’t found this was as a result of any errors made by Lloyds. Rather I’ve found Lloyds actions in each step of the events to be reasonable. I understand Mr W is also unhappy with the responses from Lloyds in relation to his complaints. Lloyds issued responses to Mr W on 15 May, 21 May, 10 June and 1 July 2025. All of these responses were issued to the correct address for Mr and Mrs W, so while Mr W has explained some of these weren’t received, I find Lloyds did as I’d expect; in that it correctly issued these letters. So, I don’t find it made an error here.. I appreciate Mr W is unhappy with the content and answers he received from Lloyds, however, as I’ve found its overall actions to be reasonable, for the reasons explained above, I find its offer of £50 to apologise for the delay in responding to be reasonable. I don’t therefore find that Lloyds must do anything further in resolution of this complaint. My final decision For the reasons I’ve explained above, I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr and Mrs W to accept or reject my decision before 21 April 2026. Christopher Convery Ombudsman

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