How to Write a Letter to a Bank About an Unfair Charge UK: A Complete Guide
- James Pite
- 4 minutes ago
- 9 min read
Banks apply charges every day. Most of them are legitimate. Some are not. Whether your bank has applied a charge incorrectly, charged you without adequate notice, applied a fee during a period of financial difficulty without considering your circumstances, or simply got something wrong, you have the right to challenge it in writing and, if the bank does not put things right, to take the complaint to the Financial Ombudsman Service for free.
This guide explains what charges you can realistically challenge, how to write a complaint letter that gets taken seriously, what the bank is required to do when it receives your complaint, and what happens if it does not respond properly.
What Charges Can You Challenge?
Not every bank charge is successfully refundable, but a surprisingly wide range of situations can lead to a partial or full refund when challenged correctly. Common grounds include:
Charges applied in error: The bank has charged you for something that did not happen, charged the wrong amount, or charged you twice for the same transaction.
Charges not disclosed clearly: Under the FCA’s Consumer Duty, banks must be transparent about their fees. If a charge was applied without adequate advance notice or without being clearly set out in the terms you were given, this is a legitimate ground for complaint.
Charges during financial difficulty: FCA rules require banks to treat customers in financial difficulty fairly. If you notified your bank that you were struggling and it continued to apply charges that worsened your position without offering any forbearance, this can be challenged.
Charges for a bank error: If the bank’s own mistake caused a payment to fail or your account to go overdrawn, and then charged you for the resulting situation, the charge is directly caused by the bank’s fault.
Excessive or disproportionate charges: While banks can charge for unauthorised overdrafts and missed payments, the FCA expects charges to be fair and not exploitative. The Consumer Duty, introduced in 2023, requires banks to ensure the price customers pay is reasonable relative to the service provided.
Charges on a closed or disputed account: Charges continuing to accrue on an account you have closed or on a product you have cancelled may be challengeable, particularly if the bank failed to process the closure correctly.
One important limitation: the Supreme Court ruled in 2009 that standard unauthorised overdraft charges cannot be challenged as unfair under the Unfair Terms in Consumer Contracts Regulations simply because they are high.
However, this does not prevent challenges based on error, lack of transparency, financial difficulty or the Consumer Duty. The grounds above remain valid.
Your Rights When Complaining to a Bank
Under FCA rules, all regulated financial firms must handle complaints fairly, consistently and promptly. As the FCA’s guidance on how to complain confirms, banks must acknowledge your complaint promptly and provide a final written response within eight weeks. For straightforward complaints they should aim to respond within three to five working days. If the bank does not respond within eight weeks, or if its response is unsatisfactory, you can take your complaint to the Financial Ombudsman Service.
The FCA’s Consumer Duty, which has applied to all regulated firms since 2023, requires banks to act to deliver good outcomes for customers. This includes being transparent about charges, treating vulnerable customers appropriately, and ensuring the price paid reflects fair value. When writing your complaint, referencing the Consumer Duty alongside any specific charge error is a legitimate and increasingly effective approach.
Before You Write: What to Gather
A well-evidenced complaint is resolved more quickly and more favourably than a vague one. Before writing, collect the following:
Bank statements showing the charge or charges you are disputing, with dates and amounts
Any communications from the bank about the charges, including letters, app notifications or emails
The bank’s terms and conditions relating to the charge, if you have them
Any record of previous contact with the bank about the issue, including reference numbers from calls
Evidence of any financial difficulty you notified the bank about, such as a letter, message or call log
Any evidence that the charge was caused by a bank error, such as a failed payment or processing mistake
How to Structure Your Complaint Letter
Address It to the Right Team
Send your letter or email to the bank’s complaints team or customer relations department. The bank’s website will have the complaints contact details. Using the correct address and the word ‘formal complaint’ in the subject line ensures it is logged under the formal complaints process and the eight-week response clock starts immediately.
State It Is a Formal Complaint
Use those exact words in the subject line and opening sentence. This is not just good practice. It determines how the correspondence is handled, triggers the bank’s FCA-regulated complaints obligations and starts the eight-week clock.
Describe What Happened Specifically
Describe the charge or charges you are disputing. Include the date, the amount, the type of charge and which account it was applied to. If there were multiple charges, list them. Reference your account number or the last four digits if security requires it. Attach your bank statement or a screenshot showing the charge.
Explain Why the Charge Is Wrong
This is the most important section. State your grounds clearly. If the charge was applied in error, explain the error. If it was applied during financial difficulty after you had notified the bank, describe when and how you notified them. If the charge lacks transparency, explain what information you were not given. If a bank error caused the situation, describe the error and its consequences.
Describe the Impact
Explain what the charge cost you beyond the charge itself. If it pushed your account further into overdraft and triggered further charges, describe that chain of events. If it caused financial distress, say so. If you incurred additional costs as a result of a failed payment caused by the bank’s error, quantify those costs.
State What You Want
Ask for a full refund of the disputed charge or charges, plus any knock-on charges they caused. If you have incurred direct costs as a result of the bank’s error, include those. You can also ask for a written explanation of how and why the charge was applied and confirmation that it will not happen again.
Full Worked Example
[Your full name]
[Your address]
[Your account number or last four digits]
[Date]
Customer Relations Team
[Bank name]
[Bank complaints address or email]
Subject: Formal Complaint – Unfair Bank Charge – [Account type], [Date of charge]
Dear Sir or Madam,
I am writing to make a formal complaint about a charge applied to my [current account / savings account / credit card] on [date]. The charge of £[amount] was described on my statement as [description of charge as it appears, e.g. ‘unarranged overdraft fee’ / ‘missed payment fee’ / ‘returned item charge’]. I am requesting a full refund of this charge for the following reasons.
What happened
[Describe the specific circumstances clearly. For example: On [date] a direct debit payment of £[amount] to [payee] was returned unpaid, generating a £[charge amount] returned item fee. This payment failed because [bank error / the account balance was insufficient due to a delayed incoming payment / a previous bank error resulted in an incorrect debit from my account on [date]]. I attach a copy of my bank statement showing the relevant transactions.]
Why this charge should be refunded
[State your grounds. For example:]
[Ground: bank error] The failed payment was a direct result of [describe the bank’s error, e.g. a duplicate direct debit instruction applied without my authorisation on [date], which reduced my balance below the level required to meet the payment]. The charge applied is a consequence of the bank’s own mistake and should not be borne by me.
[Ground: financial difficulty] I contacted the bank on [date] to notify it that I was experiencing financial difficulty. [Reference number if available.] Despite this notification, the bank continued to apply charges rather than offering forbearance or working with me on an arrangement. FCA rules require banks to treat customers in financial difficulty fairly, and I do not consider this charge to reflect fair treatment in the circumstances.
[Ground: lack of transparency] I was not made aware that this type of charge would apply in these circumstances. The charge is not clearly explained in the account terms I was provided, and I did not receive adequate notice before it was applied. Under the FCA Consumer Duty, banks must be transparent about charges and ensure customers have the information they need to make informed decisions.
Impact
This charge [describe the impact. For example: pushed my account into a deeper overdraft, triggering a further £[amount] in charges / resulted in a second payment failing due to the reduced balance / caused significant financial stress during an already difficult period].
What I am requesting
I am requesting a full refund of the £[amount] charge, plus any additional charges that arose as a direct consequence of it. I would also welcome a written explanation of why this charge was applied and confirmation that the circumstances that led to it have been reviewed.
I expect a response within the eight-week timescale required under FCA rules. If this matter is not resolved to my satisfaction, I will refer my complaint to the Financial Ombudsman Service.
Yours sincerely,
[Your name]
[Contact details]
[Attachments: bank statement excerpt dated [date]]
What the Bank Must Do After Receiving Your Complaint
Under FCA rules, the bank must acknowledge your complaint promptly and provide a final written response within eight weeks. For simpler complaints it should aim to respond within three to five working days. The final response must explain its findings, tell you whether it is upholding the complaint and, if so, what remedy it is offering. It must also tell you about your right to take the complaint to the Financial Ombudsman Service if you are not satisfied.
If the bank upholds your complaint, it should refund the charge and any knock-on charges, and may offer additional compensation for distress or inconvenience where appropriate. If it does not uphold the complaint, it must explain why.
If the Bank Refuses or Does Not Respond Within Eight Weeks
If the bank rejects your complaint or does not respond within eight weeks, you can take your complaint to the Financial Ombudsman Service. The Ombudsman is free, independent of the banks and has the power to direct the bank to refund charges and pay compensation. You must refer your complaint to the Ombudsman within six months of the date on the bank’s final response letter. The Ombudsman resolved over 227,000 financial complaints in the year to May 2025, and banking and credit complaints are among the most common types it handles.
You do not need a solicitor or a claims management company to use the Financial Ombudsman. The service is designed to be used directly by consumers without any professional representation. Anyone offering to handle your Financial Ombudsman complaint for a fee should be treated with caution.
Specific Situations: What to Say
Charges During Financial Hardship
If you are or were in financial difficulty when the charges were applied, this is one of the strongest grounds available. The FCA requires banks to treat customers in financial difficulty with forbearance and due consideration. If you had already told the bank you were struggling and it applied further charges anyway without discussing any arrangement with you, reference this specifically. Note the date and method of your notification, any reference number given, and the charges applied after that notification.
Multiple Charges Following a Single Event
Banks sometimes apply several charges following a single event, such as a bounced direct debit leading to an unarranged overdraft fee, a returned item fee and a daily overdraft charge. If the original event was caused by the bank’s error, all of the resulting charges are potentially recoverable. List each charge separately with its date and amount and describe how each one arose from the original error.
Charges on a Deceased Person’s Account
If you are handling the estate of someone who has died and you believe charges were applied unfairly to their account, you can complain on behalf of the estate. Describe your role (executor or administrator), provide evidence of your authority to act and the same grounds for complaint apply. Banks are expected under FCA rules to treat bereaved customers with particular sensitivity.
Getting Help
Free advice on bank complaints and your rights is available from Citizens Advice, whose advisers can help you understand whether your grounds are strong and how to frame your complaint. The Financial Ombudsman Service also has a consumer helpline on 0800 023 4567 if you want to discuss your situation before escalating. If you want help drafting a complaint letter that addresses the right grounds clearly and gives the bank the information it needs to act, the team at LetterLab can help you get it right.
Quick Checklist: Before You Send Your Complaint
Does the subject line use the words ‘formal complaint’?
Have you included your account details so the bank can locate the relevant account immediately?
Have you described each charge you are disputing with the date and amount?
Have you stated the specific ground for your complaint: error, financial difficulty, lack of transparency or Consumer Duty breach?
Have you described the impact of the charges on your account and your financial position?
Have you stated what you want: refund, explanation, confirmation of corrective action?
Have you attached your bank statement or a screenshot showing the charges?
Have you noted the eight-week response deadline and mentioned the Financial Ombudsman?
Are you sending it to the complaints team specifically, not a general customer service address?
Have you kept a copy and noted the date you sent it?
The Key Takeaway: Write It Formally, Know Your Grounds, Follow Through
Banks receive millions of complaints every year. The ones that get refunds are not necessarily the ones where the grievance is greatest. They are the ones that are clearly written, state specific grounds, reference the bank’s obligations and follow through if the initial response is unsatisfactory.
The Financial Ombudsman Service exists precisely for situations where a bank has not treated a customer fairly and has refused to put things right. It is free, it is independent and it has genuine power to direct banks to make refunds and pay compensation. You do not need a lawyer. You need a clear letter, a specific ground and the willingness to escalate if the bank does not engage.
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