What the Financial Ombudsman Service is
The Financial Ombudsman Service (FOS) is the UK's independent dispute resolution body for complaints between consumers and FCA-authorised firms. It was established under the Financial Services and Markets Act 2000 and operates as the statutory escalation route when a regulated firm has failed to resolve a complaint to the consumer's satisfaction.
The service is free to use. There is no application fee, no need for legal representation and no requirement to use a claims management company. The FOS investigates complaints based on what is fair and reasonable in the circumstances, drawing on FCA rules, industry codes of practice, applicable law and good industry practice. Decisions issued by an ombudsman are legally binding on the firm if the consumer accepts them.
The FOS is free, independent and produces decisions that are legally binding on the firm. Consumers do not need a lawyer or a claims company to use it.
The basic position
The Ombudsman service handles the majority of complaints involving banking, lending, insurance, investment, mortgages, pensions and consumer credit products. Complaints brought directly by consumers are upheld at a higher rate than those brought through claims management companies. FOS data shows roughly 40 per cent of direct submissions are upheld, compared with around 26 per cent of CMC-routed cases. The service handled 305,726 new complaints in 2024/25 across all product categories.
When you can refer a complaint
The FOS becomes available to a consumer once two conditions have been met. The consumer must have first complained to the firm directly. The firm must then either issue a final response that the consumer disagrees with or fail to respond within 8 weeks. Either of these triggers the right to refer the matter to the ombudsman.
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Complain to the firm in writing
FCA rules require every authorised firm to operate a complaints procedure. The complaint should be made clearly, in writing, with copies of all supporting documents retained. The 8-week clock starts on the date the firm receives the complaint.
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Wait for the firm's final response
The firm has up to 8 weeks (or 15 working days for payment-services complaints) to issue a final response letter. The letter must explain the firm's position and inform the consumer of their right to refer the matter to the FOS, including the deadline for doing so.
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Refer to the FOS within 6 months
If the consumer disagrees with the final response (or if the 8-week period expires without one) the consumer has 6 months to refer the matter to the FOS. The 6 months runs from the date of the firm's final response or from the end of the 8-week period.
The FOS will not take a complaint until the firm has had its chance
This is one of the most common reasons complaints are returned to consumers. The firm must be given the opportunity to investigate and respond before the FOS can step in. The only exception is where the firm has explicitly refused to consider the complaint or has otherwise made it clear that no final response will be issued.
The time limits that apply
Three separate deadlines govern when a complaint can be brought. All three must be met for the FOS to consider the case. Missing any one of them will normally result in the complaint being declined as out of time, although exceptional circumstances are sometimes accepted.
| Limit | Deadline | How it works |
|---|---|---|
| Six-year rule | 6 years from event | Counts from when the act or omission occurred |
| Three-year rule | 3 years from awareness | Counts from when the consumer knew (or should have known) of the cause for complaint |
| Six-month rule | 6 months from final response | Counts from the firm's final response letter or from end of 8-week period |
The first two limits work together. A complaint must be brought within whichever is the later of (a) 6 years from the event or (b) 3 years from the date the consumer became aware of a reason to complain. The third limit operates separately and applies once the firm has issued its final response. If the firm fails to mention the FOS or the 6-month deadline in its final response letter, the deadline can sometimes be extended at the FOS's discretion.
What the FOS does and does not handle
The FOS has jurisdiction over a wide range of regulated financial products. It does not have jurisdiction over every type of dispute. Understanding the boundaries saves time and helps consumers identify the correct route from the outset.
What the FOS will investigate
- Banking and savings accounts
- Personal loans and credit cards
- Mortgages and remortgaging
- Insurance (most types)
- Investment products and platforms
- Pensions (most types)
- Mis-sold financial products
- Unfair lending and irresponsible credit
- APP fraud refund disputes
- Claims management companies
What the FOS will not investigate
- Disputes already decided by a court
- Complaints against unauthorised firms
- Most B2B financial disputes
- NS&I products (separate complaints route)
- Most cryptocurrency disputes
- HMRC and tax-related matters
- Pension scheme administration (Pensions Ombudsman)
- Property agent disputes (Property Ombudsman)
- Complaints about FCA decisions themselves
- Commercial lending above SME thresholds
The "small business" threshold for FOS jurisdiction is 50 employees, an annual turnover under £6.5 million and an annual balance sheet under £5 million. Charities and trusts are also covered if they meet equivalent thresholds. Where a dispute falls outside the FOS scope, alternative routes typically exist, including the Pensions Ombudsman, the Legal Ombudsman, the Property Ombudsman or the courts. To confirm whether a firm is authorised before bringing a complaint, see our guide on verifying FCA authorisation. For complaints about unauthorised firms, see our guide on scams and loan sharks.
How the FOS process works
The FOS process is deliberately informal compared with court proceedings. There is no cross-examination. No witness statements are required. No legal representation is needed. Most cases are resolved through written submissions reviewed by the case handler, with telephone calls or video meetings only where necessary.
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Submission
The consumer submits the complaint to the FOS, either online via the Financial Ombudsman website, by phone (0300 123 9 123), email or post. The submission should include the firm's final response letter, the original complaint and any supporting documents. The FOS provides a complaint form to guide the process.
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Initial review
A FOS case handler confirms whether the complaint falls within the FOS jurisdiction and assigns a case reference number. The handler will then contact the firm to obtain the firm's file on the matter. Allocation to a case handler typically takes one to two months from submission.
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Investigation and initial assessment
The case handler reviews the evidence from both sides and issues an initial assessment. The assessment explains whether the FOS believes the firm has acted fairly. Either party can accept this assessment, which then settles the case. Roughly 90 per cent of cases are resolved at this stage.
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Referral to an ombudsman
If either party rejects the case handler's assessment, the case is referred to an ombudsman for a final decision. The ombudsman re-examines the evidence and issues a binding final decision. The full process from submission to ombudsman decision typically takes around 90 days for straightforward cases, longer for complex ones.
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Acceptance and enforcement
The consumer chooses whether to accept the final decision. Acceptance makes the decision binding on the firm. Rejection leaves the consumer free to pursue court action instead, but the same complaint cannot be reopened with the FOS.
What makes a complaint more likely to be upheld
Not every complaint succeeds. The FOS uphold rate across all complaints in 2024/25 was 34 per cent. Several factors consistently distinguish upheld complaints from rejected ones. Most of these factors are within the consumer's control during preparation.
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Clear written evidence of the original complaint
The FOS expects to see a written complaint to the firm, dated, with the issues set out clearly. Verbal complaints are accepted but harder to evidence. A clear paper trail makes the case easier to assess and reduces the risk of the firm disputing the timeline.
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Specific reference to the rule or duty breached
Citing the relevant FCA rule, the Consumer Duty or a specific provision of the Consumer Credit Act 1974 significantly strengthens a complaint. Generic statements that the firm "behaved unfairly" carry less weight than a specific allegation that the firm breached a particular obligation.
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Documented financial loss or harm
Complaints succeed more often where the consumer can quantify the loss caused by the firm's conduct. Bank statements, comparison quotes, interest calculations and credit file impacts all support a claim. A claim of "distress" is harder to evidence than a claim of specific financial loss.
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A reasonable proposed remedy
Complaints that propose a specific, proportionate remedy are taken more seriously than open-ended demands. A remedy framed in terms of refund of charges, removal of credit-file markers and recalculation of the balance is far more likely to succeed than a request for a large round-number compensation payment.
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Calm, factual tone throughout
The FOS handles a high volume of cases. Submissions that are calm, structured and focused on the facts are easier and faster for the case handler to work through. Emotional or accusatory language does not strengthen a case and can sometimes obscure a strong underlying argument.
Does using a claims management company improve the chances of success?
No. FOS data consistently shows that complaints brought directly by consumers are upheld at a higher rate (around 40 per cent) than those routed through claims management companies (around 26 per cent). CMCs typically charge a percentage of any award, often 25 to 40 per cent, while contributing nothing the consumer cannot do themselves. The FOS provides a straightforward online complaint form designed for direct consumer use.
What compensation the FOS can award
The FOS has the power to direct a firm to take specific steps to put the consumer back in the position they would have been in had the firm acted fairly. The remedy depends on the type of complaint and the loss suffered. The most common remedies include direct refunds, removal of negative credit file entries, recalculation of outstanding balances and compensation for distress and inconvenience.
| When the act or omission occurred | Maximum award | Notes |
|---|---|---|
| On or after 1 April 2019 | £455,000 | Adjusted annually for inflation |
| Before 1 April 2019 | £205,000 | Adjusted annually for inflation |
| Distress and inconvenience element | Typically £100 to £750 | Higher in cases of significant distress |
| Interest on awards | BoE base rate plus 1% | From 1 January 2026 (previously 8% simple) |
The interest rate change is a recent and important development. Until 31 December 2025, FOS awards attracted 8 per cent simple interest, a rate set when the Bank of England base rate was substantially higher. From 1 January 2026, the rate has changed to Bank of England base rate plus 1 per cent. The change reflects the lower interest rate environment and applies to all awards calculated after that date. For specific guidance on calculating compensation in unfair lending cases, see our guide on claiming compensation for unfair lending.
The FOS can recommend higher awards
Where the FOS believes a firm should pay more than the statutory maximum, the ombudsman can issue a recommendation that the firm pay the additional amount. The recommendation is not binding, but most firms comply, particularly where the additional amount is modest relative to the firm's size. Where the firm refuses, the consumer retains the right to pursue the balance through the courts.
Why claims management companies are usually the wrong choice
Claims management companies (CMCs) advertise heavily for FOS complaint work. They charge a percentage of any award, typically 25 to 40 per cent. The FOS data on CMC-routed cases is consistent and clear: complaints brought through a CMC succeed less often than complaints brought directly. A CMC rarely adds value beyond the consumer's own efforts. The cost of using one is significant.
"A CMC has expert knowledge that improves my chances of winning."
False. Direct submissions are upheld at around 40%, CMC submissions at around 26%. The FOS process does not reward expertise so much as clear, factual, well-evidenced submissions.
"A CMC will save me time on a complex complaint."
Often false. The CMC will still need the same documents from the consumer and ask the same questions. Filling in the FOS's own form takes around 30 minutes and avoids the 25-40% fee.
"There is no fee unless I win."
Misleading. "No win, no fee" describes when the fee applies, not how much. A 30% fee on a £4,000 award is £1,200 the consumer would otherwise have kept. The free direct route awards the same outcome.
If a CMC has already been appointed, the agreement can usually be cancelled within a 14-day cooling-off period. After that period, exit terms vary by contract. CMCs are themselves regulated by the FCA. Complaints about their conduct can be referred to the FOS.