Santander UK Plc · DRN-5466062

The complaint A company which I’ll call ‘B’ complains that Santander UK Plc (Santander) acted unreasonably when it closed its business accounts. B has been represented in this complaint by one of its directors, Mr N. What happened The background to this complaint is well known to all parties so I’ll just give a broad overview here. On 8 August 2024, Santander wrote to B telling it that its two business accounts would be closed on or after 6 November 2024. Santander explained that it had reviewed the nature of B’s business and its relationship with Santander and, following this, had decided, on economic grounds, to close the accounts and no longer offer B banking facilities. B complained to Santander that the closure had not been discussed with it before the decision was made and further that no alternative banking accounts had been offered. In response, Santander said the decision wasn’t based on how B’s accounts had been conducted or due to any activity. It repeated that the decision was based entirely upon economic grounds – and it wouldn’t expand any further on this explanation. B wasn’t satisfied with this response and made a number of further points to Santander. These included the way the account had been closed, the reasons for the closure and the failure to offer alternative banking arrangements. In its final response, Santander repeated the decision had been made on economic grounds and said it was unable to provide more detailed information as it was commercially sensitive. B remained unhappy so brought the complaint to this Service. Our Investigator reviewed the complaint and didn’t think Santander had acted unreasonably. He thought that Santander was able to close the accounts under its terms and conditions. He also said that Santander was free to make commercial decisions and, having reviewed additional confidential information from Santander, was satisfied it had acted fairly under the terms and conditions of the account. B wasn’t satisfied with this response and so the complaint has been passed to me for a final decision.

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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. From the evidence I’ve seen, B doesn’t dispute that Santander was able to give notice to close its business accounts but does dispute that it was done fairly and reasonably. So, in this decision I’ve dealt with B’s complaint points about how the accounts and withdrawal of business relationship was dealt with. I’ve summarised the key complaints under headings below: The reasons for the account closures B has said it was unhappy that the decision to close the accounts wasn’t discussed directly with it. B says if that had been the case it could have demonstrated to Santander its future business expansion plans which it says would likely lead to its accounts meeting the profitability requirements. B has also suggested that its recent repayment of a Coronavirus Business Interruption Loan (CBIL) was influential in Santander’s decision to close its accounts. B also queried what were the conditions and criteria for Santander to consider it an economically viable account. And given Santander didn’t speak to B before its decision then it wasn’t aware of its expansion plans and so couldn’t accurately assess its economic viability. In summary, B thinks that Santander have failed to meet its responsibilities to it as a customer by not meeting Consumer Duty and Know Your Customer (KYC) requirements. I’ve thought carefully about the points B has raised but from the evidence that’s been provided I think Santander acted fairly given the terms and conditions of the accounts. These terms allow Santander to give sixty days’ notice to close accounts, and this is what it did. I’ve seen evidence from Santander that the repayment of the CBIL wasn’t a consideration in its decision and that it had simply exercised its right to periodically review its account portfolio and close those it felt were economically unviable against its latest profitability criteria. And B’s accounts were part of this review. Santander is not bound to share the commercially sensitive criteria it uses when making these decisions and it’s not this Service’s role to interfere with this process. Santander has legal and regulatory obligations that it is required to meet which include KYC checks. It’s a commercial decision that it is able to make both on how it meets these obligations and, also, how it decides to run its business. It’s not for our service to tell Santander that it should continue to offer accounts that it has decided to close, unless we believe it has behaved unreasonably. And I’m not persuaded that’s the case here. B has commented about the consumer duty; however, my role is to take into consideration all relevant laws and regulations but ultimately decide my outcome on the basis of what is fair and reasonable. In this case, I’m satisfied that Santander gave B the relevant notice and I don’t think it has done anything wrong.

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Santander were satisfied with B’s identity and had sight of its account activity and used this to assess the accounts profitability. As such it was within its rights to make the commercial decision on the information it had and wasn’t bound to obtain additional details. It could, of course, have undertaken a more thorough review involving analysis of businesses plans. But Santander chose to use historic and recent data to analyse profitability, and this is something it’s entitled to do. In summary, Santander were entitled to review its portfolio of accounts under the terms and conditions of these accounts and close those it deemed no longer profitable as long as it gave sixty days written notice of closure. It’s entitled to make such commercial decisions and is not bound to share the business criteria on which it makes such decisions. This is what Santander did in this complaint and so I don’t think it did anything wrong. The absence of alternative banking arrangements offered B feels that it should have been offered alternative banking arrangements with Santander. It says that Santander had insisted it transfer its previous business account to its Corporate and Commercial division and the account Santander had decided to now close. And B is unhappy that the ability to switch to its former account with Santander wasn’t offered. Santander have said that the responsibility to find alternative banking arrangements lies solely with B and that customers can’t be switched internally as different areas of the bank will have different account criteria. I have some sympathy with B here. Given the disruption the closing of the accounts is likely to have caused B, it would have been helpful for Santander to at least provide links or introductions to other parts of the group to discuss possible alternative banking services. But, again, while this would have been helpful it wasn’t something Santander were bound to do so I can’t say it did anything wrong. Finally, Mr N has said that he has been caused stress and inconvenience as a result of Santander’s actions and I’m sorry if this has been the case. However, our service is governed by DISP rules which say that we can only look at complaints on behalf of an eligible complainant, which in this case is B. It therefore follows that I can only award compensation to B. However, as I’ve explained, I don’t think Santander did anything wrong in closing B’s accounts, so I won’t be considering any inconvenience caused to the company because of this. My final decision For the reasons stated above I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask B to accept or reject my decision before 13 August 2025. Ben Castell

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Ombudsman

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