Complaining about your lender

 July 2018

Fact sheet no. 24 SCOT Complaining about your lender

This fact sheet deals with complaints about companies which give credit, such as banks, payday lenders, hire purchase companies and so on. It also applies to debt collection agencies. It does not apply to companies that supply gas, electricity or water or to councils. If you have a complaint about one of these organisations, contact us for advice.

Use this fact sheet to:

  • understand what you can complain about;
  • get tips on making an effective complaint;
  • find out how to complain to the Ombudsman; and
  • decide if you can take legal action against your lender.

The sample letter mentioned in this fact sheet can be filled in on our website.

Consumer credit complaints


action the FCA can take

The Financial Conduct Authority (FCA) cannot deal with individual complaints. However, as the regulator, they can take action against companies. This means they are interested in collecting information and evidence about poor behaviour. Contact us for advice.

Because of the Consumer Credit Act 2006, all businesses with a consumer credit licence from the Financial Conduct Authority (FCA) must have a formal complaints procedure. If they do not, or if they do not follow the procedure properly, their consumer credit licence may be affected. Without a consumer credit licence, a company cannot legally offer credit. Companies that must have a consumer credit licence include:

  • businesses whose main activity is lending and hiring;
  • debt collectors; and
  • credit brokers and businesses who offer consumer credit, such as motor dealers and furniture retailers. 

Financial Ombudsman Service (FOS)


lender's complaints procedure

You can only complain to FOS once you have gone through your lender's complaints procedure. See How to complain later in this fact sheet.

The Financial Ombudsman Service (FOS) plays a very important part in complaints. It does not have the power to fine or punish businesses, but it can help settle disputes between businesses and consumers. FOS can look into your complaint, and can award compensation to you.

What can you complain about?

FOS can help with most complaints about UK consumer credit products and services. For example:

  • banking;
  • credit cards and store cards;
  • loans and hire purchase;
  • payday loans and pawn broking; and
  • debt collectors.

Who can complain?

You do not need specialist help to complain. The FOS complaints procedure is easy to follow, and you should not be disadvantaged if you don’t have any help. However, if you do not feel happy doing it yourself, you can appoint someone to act on your behalf. You must give them written permission to do this because of data protection rules. The person could be a friend, family member or an organisation such as a citizens advice bureau. See Useful contacts towards the end of this fact sheet for how to find your local citizens advice bureau.


claims management companies

There are many companies that offer to help people make complaints, but charge a fee for doing so. There is no need to pay. It costs nothing to complain to the Financial Ombudsman Service (FOS). You can also call them for free if you need guidance and information on complaining, or contact us for advice.

How to complain

Before FOS will look at your complaint, you must first complain to your lender.

  • Write to your lender explaining your complaint.
  • Set out the facts as clearly as you can.
  • Say what you are not happy with, and what you want them to do about it.
  • Include any evidence that you feel supports your complaint.
  • You may find the Complain to your lender sample letter helpful.

Extra advice:

complaints procedure

Ask your lender for a copy of their complaints procedure. This will tell you how you can expect your lender to deal with your complaint, and in what timescale.

By law, your lender has eight weeks to respond to your complaint. FOS is not able to look into your complaint before this time period is up. They can still offer information and guidance. See Useful contacts towards the end of this fact sheet for how to contact FOS.

If you are not happy with your lender’s response to your complaint

If you are not happy with the outcome of your complaint to your lender, or they do not respond at all, you can take your complaint to FOS.

You have 6 months from the date of your lender’s final response to take your complaint to FOS.  Often your lender will tell you when their response is final. It may be their only response to your complaint. If you are not sure, ask your lender. If you do not complain to FOS within 6 months, they may not be able to help. Time limits may also apply if what you are complaining about happened some time ago, or you left it too long after you knew, or should have known, there was a problem. Contact us for advice.

To make a complaint to FOS, you need to fill out their complaints form. This is available on their website, or phone them on 0300 123 9123.  They can help you to fill the form in over the phone.

Unfair relationships test

The Consumer Credit Act 2006 brought in new rules about ‘unfair relationships’ between borrowers and lenders. If you think that the interest rate being charged on your agreement is very high, or there other terms and conditions in your agreement that are unfair, you may be able to take action.

The unfair relationship rules apply to new agreements from 6 April 2007 and all existing agreements from 6 April 2008. The new rules replace the ‘extortionate credit' rules in the Consumer Credit Act 1974. The rules cannot be used for regulated mortgage contracts. Regulated mortgage contracts include first charge mortgages and secured loans. The rules can be used for some secured loans that were taken out before 21 March 2016, contact us for advice


reporting an unfair relationship

You can report an unfair relationship to the Financial Conduct Authority (FCA). The FCA website gives more information about how they challenge unfair terms

Only a court can decide if an agreement is unfair under the rules. If they decide it is unfair, they have a wide range of powers. They can change the terms of the agreement or order the lender to pay money back.

There is no set list of what is an unfair relationship. This means that taking court action using these rules is complicated. You must get proper legal advice. Contact us for advice.


If you owe money, your lender or a debt collector is allowed to contact you to ask for payment. However, they must not threaten or harass you. If you think the behaviour of your lender or debt collector might be harassment, you can complain. The Financial Conduct Authority (FCA), in the Consumer Credit sourcebook, has published detailed rules and guidance which set out how companies should behave when collecting debts. Contact us for advice.

Useful contacts

Citizens Advice Bureau
(Independent, free advice on issues such as debt, housing and benefits)
Phone: 0808 808 90 60  

Citizens Advice consumer service
(Free and independent advice on consumer issues)
Phone: 0845 404 0506

Financial Conduct Authority
Phone: 0845 606 1234

Financial Ombudsman Service
South Quay Plaza
183 Marsh Wall
E14 9SR
Phone: 0800 023 4567 or 0300 123 9123

Money Advice Service
(Useful information about making a complaint)
Phone: 0300 500 5000