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Using a financial ombudsman: when should I use one? And how do I choose?

Tom Bailey

Tom Bailey
Dec 28, 2016

Getting bogged down in a dispute with your bank can often be solved by calling upon the services of an expert financial ombudsman.

Whether its disputing an overdraft fee, mystery debit transaction, or accidentally transferring money to the wrong account, we've put together guides on how to get your money back.

But while a few emails often result in reaching an agreement or settlement with your bank, there are occasions when disputes become more drawn out.

Often, the only way to keep fighting is to use the services of a financial ombudsman.

For first time users, this can seem like a confusing process.

Here’s our simple guide explaining when, why and how to use a services of an expert financial ombudsman.


What is a financial ombudsman?

In the simplest of terms, a financial ombudsman is an independent financial adviser.

Since 2001, the official Financial Ombudsman Service has had statuary powers.

Its official purpose is to help in the settling of disputes between consumers and UK-based financial services, chiefly banks and building societies.

Most importantly, it is free to use.

The Financial Ombudsman Service is a vital tool for consumers fighting back against unfair practices from banks.


When should I use one?

You should only appeal for the services of the Financial Ombudsman after all other options with your bank have been exhausted.

Banks must deal with your complaint within eight weeks, or inform you why it is taking longer.

Should eight weeks pass following your initial complaint, it is then time to enlist the help of the Financial Ombudsman Service.

Alternatively, if you feel that your complaint is getting nowhere before the end of the eight weeks, you can request a “letter of deadlock" from your bank.

This will allow you to pursue the matter with the Financial Ombudsman.


How do I contact the Financial Ombudsman?

The Financial Ombudsman website can be found here and it can be reached on 0800 023 4567. The simplest way to get their help is to fill out their complaint form.

This is about three pages long. You will need to outline your issue as well as enclose any evidence relating to the matter.

Alternatively, you can use their helpline found on their website.

Seeking the help of the Financial Ombudsman can sometimes be rather long.

The waiting time for a dispute to be settled can sometimes take months, or in the worst cases can take years. The average time, however, is around six months. Before pursuing a complaint, then, consider whether it is worth your time. 


What does the Financial Ombudsman do?

The Financial Ombudsman will review your case and come to a conclusion based on their own expertise on the matter.

It will contact the other party involved (your bank) and may contact you asking for further evidence.

Once the organisation has made up its mind, it will write to both you and the bank explaining its decision.

If the Financial Ombudsman rules in your favour, it will outline what steps the bank must take to remedy the situation.

This can range from a simple recommendation that the bank issue a formal apology, to a recommendation that the bank overhaul its business practices to avoid similar issues.

If ruled in your favour, the Financial Ombudsman may also recommend you receive a refund or a compensation for the inconvenience you have experienced. 

Have you ever used a financial ombudsman?

Tell us about how you find the service in the box below.