NATIONAL WESTMINSTER BANK PUBLIC LIMITED COMPANY · DRN-6073147

The complaint Mr I is unhappy with how NATIONAL WESTMINSTER BANK PUBLIC LIMITED COMPANY (NatWest) administered his account. What happened The parties are familiar with the background of this complaint, so I will summarise it here, which reflects my informal remit. Mr I took out a personal loan for £25,000 with NatWest in November 2021. The total repayable amount was around £30,150.00, over a 60-month term, with monthly repayments of around £500. Payments were maintained until March 2023, after which the account fell into arrears. In June 2023, Mr l contacted NatWest to explain he was experiencing financial difficulty. An income and expenditure assessment was completed, and Mr I says it was agreed he would make reduced payments of £100 per month. When no payments were made, and the account remained in arrears, NatWest issued a default notice on 19 October 2023 requiring payment by 15 November 2023, to avoid further action on the account. As payment wasn’t made, the account defaulted and a termination notice was issued on 20 November 2023. On 29 November 2023 NatWest says it informed Mr I during a call that the account had defaulted and had been passed to a debt collection agency. In May 2025, Mr I complained to NatWest. He said he had only recently become aware of the default when renewing his mortgage. He also said he had been making payments via the debt collection agency and hadn’t received any default or termination notices. NatWest issued a final response not upholding the complaint. It said it wouldn’t remove the default as it had issued all the regulatory letters to his address on file and had also informed him of the default during a call in November 2023. When an investigator considered the case, they didn’t uphold it. In summary they said the default had been applied correctly. Mr I didn’t agree with the investigator’s view. In summary he said: • He had engaged with NatWest in June 2023, believed a repayment arrangement had been agreed, and was unsure why no payment had been taken. • His financial difficulties were due to circumstances outside his control as funds were being held with another bank. • Although he didn’t update his address, he still had access to the property and didn’t receive the notices. • He was unaware of the default until much later and acted promptly once he became

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aware. • He believed the call recording from November 2023 supported his view that he was unaware of the default notice. • He was willing to settle the balance in full and wanted the default removed. As Mr I remained unhappy, the case has now been referred to me to make a final decision. 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. Whilst I’ve read and considered everything, if I don’t mention any specific point, it’s not because I failed to take it on board and think about it, but because I don’t think I need to comment on it to reach what I think is a fair and reasonable outcome. This is not meant as a discourtesy but rather reflects my role of resolving disputes with minimum formality. It is not in dispute that Mr I stopped making his contractual payments from March 2023 and the account fell into arrears. Mr I’s explained that he experienced financial difficulty due to circumstances outside his control. I appreciate the impact this would’ve had on his ability to meet his financial commitments. However, in this decision I am only able to consider the actions of NatWest and whether its decision to default the account was fair and reasonable. I can see that when Mr I fell behind with payments, he contacted NatWest in June 2023 to discuss his situation. An income and expenditure assessment was undertaken, which I consider was a reasonable thing for NatWest to have done. While Mr I says a reduced payment of £100 per month was agreed, I haven’t seen evidence that any payments were made under this arrangement. As a result, the account remained in arrears. Given that no payments were received for several months after June 2023, I think it was reasonable for NatWest to treat the arrangement as not being maintained and to take further action. If payments weren’t being taken as expected, I would’ve also expected Mr I to query this with NatWest at the time. I haven’t seen evidence that he did so. In those circumstances, I’m satisfied it was reasonable for NatWest to issue a default notice in October 2023. When the required payment wasn’t made by the deadline in the default notice, and no further contact or payment was received, I also consider it was reasonable for NatWest to proceed to default the account. I’ve considered Mr I’s comments that he didn’t receive the default or termination notices. However, he’s acknowledged that he didn’t update his address. Lenders are generally entitled to rely on the address provided by the customer unless they are informed of a change. While Mr I says he still had access to the previous address and still didn’t receive the notices at the time, I can see the notices were correctly addressed to him and sent to that address. As I haven’t seen evidence to suggest they weren’t issued correctly, I’m satisfied NatWest met its obligation by sending the correspondence to the address it held on file. I’ve also taken into account the call in November 2023, during which NatWest says it informed Mr I that the account had defaulted. Even if Mr I wasn’t fully aware of the situation before then, this doesn’t affect whether NatWest acted fairly in applying the default, given the steps it had already taken.

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Finally, I’ve also considered whether NatWest should’ve waited longer before registering a default. The Information Commissioner’s Office (ICO) has guidance as to when a default should be applied to an account. The ICO states a default should be registered after three to six months of missed payments. In this case, payments had been missed for several months, and no payments were made either after the June 2023 discussion or following the default notice. So, I’m satisfied the default was applied in line with this guidance. Taking everything into account, I’m satisfied that NatWest acted fairly and reasonably in its handling of the account and the subsequent default. While I understand this will be disappointing for Mr I, I don’t require NatWest to remove the default from his credit file. My final decision I don’t uphold this complaint against NATIONAL WESTMINSTER BANK PUBLIC LIMITED COMPANY. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr I to accept or reject my decision before 17 April 2026. Farhana Rahman Ombudsman

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