| Business Payments |
A payment provider has up to 8 weeks to give a final response before an eligible business can take a complaint to the Financial Ombudsman Service. Eligibility thresholds and award limits are set by the FOS. For micro-enterprises and SMEs, the FOS can consider complaints and make awards up to its current limit.
Businesses have 8 weeks to receive a final response from their payment provider before they can escalate a complaint to the Financial Ombudsman Service, which can award up to its current limit.
KEY FACTS
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LAST REVIEWED 2026-09-06
Who can complain to FOS
The Financial Ombudsman Service (FOS) is an independent body in the United Kingdom that resolves disputes between consumers and financial businesses. For card machine complaints, eligibility extends beyond individual consumers to certain businesses. Specifically, micro-enterprises and small and medium-sized enterprises (SMEs) can bring a complaint to the FOS, provided they meet the size criteria set out by the FOS.
A micro-enterprise is defined as a business that employs fewer than 10 persons and has an annual turnover or balance sheet total not exceeding £2 million. An SME is defined as a business that employs fewer than 250 persons and has an annual turnover not exceeding £50 million, or an annual balance sheet total not exceeding £43 million. These thresholds align with the definitions used in the Payment Services Regulations and the E-Money Regulations, which are relevant to card payment providers.
If a business exceeds these thresholds, it is not eligible to complain to the FOS. Instead, such businesses may need to pursue other dispute resolution mechanisms, such as court proceedings or arbitration, if available. The FOS also cannot consider complaints from businesses that are not considered 'eligible complainants' under its rules.
The 8-week rule
When a business has a complaint about a card machine provider, the provider is required to respond to the complaint within a specific timeframe. Under the rules of the Financial Ombudsman Service, a payment provider has up to 8 weeks from the date it receives the complaint to issue a final response. This 8-week period is a key part of the complaint process.
If the provider fails to give a final response within 8 weeks, or if the business is dissatisfied with the response given, the business can then refer the complaint to the Financial Ombudsman Service. The 8-week rule is designed to give providers a reasonable opportunity to resolve complaints internally before the Ombudsman becomes involved.
It is important to note that the 8-week period starts from the day the provider receives the complaint, not from the day the business sends it. Businesses should keep records of when they submitted their complaint and any correspondence with the provider, as this will help establish the timeline if the complaint is escalated.
What FOS can decide on
The Financial Ombudsman Service can consider a wide range of complaints relating to card machine services. This includes disputes over contract terms, such as unexpected fee increases, early termination charges, or the provision of equipment. The FOS can also look at complaints about the handling of transactions, such as delayed settlements, incorrect charges, or failure to provide services as agreed.
In addition, the FOS can investigate complaints about the conduct of the payment provider, including misrepresentation during the sales process, failure to provide clear information about fees, or poor customer service. The Ombudsman will assess whether the provider has acted fairly and reasonably in accordance with the law and good practice.
When making a decision, the FOS will consider the relevant regulations, such as the Payment Services Regulations and the E-Money Regulations, as well as the terms of the contract between the business and the provider. The FOS can direct the provider to take remedial action, such as correcting a billing error, or to pay compensation for any loss or distress caused.
Award limits
The Financial Ombudsman Service has the power to make awards to successful complainants. For complaints referred to the FOS, the maximum award that can be made is currently set at £430,000 (this figure is subject to change and should be verified on the FOS website). This limit applies to the total amount of compensation that the FOS can require a provider to pay, including any interest and costs.
It is important to note that the award limit is not a target or a guarantee. The amount of compensation awarded will depend on the specific circumstances of each case, including the financial loss suffered by the business and any distress or inconvenience caused. The FOS will also take into account any offers already made by the provider.
If a business believes that its loss exceeds the FOS award limit, it may still complain to the FOS, but it would need to accept that the maximum it can receive is the limit. Alternatively, the business could pursue legal action in the courts, but this may be more costly and time-consuming.
Complaints FOS cannot take
There are certain types of complaints that the Financial Ombudsman Service cannot consider. For example, the FOS cannot take complaints from businesses that do not meet the eligibility criteria, such as large enterprises with more than 250 employees or turnover exceeding £50 million. Additionally, the FOS cannot consider complaints that are about the provider's general business practices or that are not related to a specific financial transaction or service.
Complaints that are already being dealt with by a court or that have been settled between the parties may also be excluded. Furthermore, the FOS will not consider complaints that are made more than six years after the event that gave rise to the complaint, or more than three years after the complainant became aware (or should have become aware) of the problem.
It is also important to note that the FOS cannot cancel a contract between a business and a provider. While the FOS can direct a provider to pay compensation or take corrective action, it does not have the power to void or amend contractual terms. If a business wants to cancel a contract, it may need to rely on the terms of the contract itself or seek legal advice.
Writing the complaint
Before a complaint can be referred to the Financial Ombudsman Service, the business must first give the payment provider a chance to resolve the issue. This means that the business should submit a formal complaint to the provider in writing, clearly setting out the nature of the problem, the details of the contract, and the desired outcome. It is advisable to include any relevant documentation, such as contracts, invoices, and correspondence.
The provider is then required to acknowledge the complaint and investigate it. Under the rules, the provider must give a final response within 8 weeks. If the provider fails to do so, or if the business is unhappy with the response, the business can then escalate the complaint to the FOS. The business must do this within six months of the provider's final response, or within six months of the 8-week deadline if no response is given.
When writing to the FOS, the business should provide a clear summary of the complaint, explain why it believes the provider has acted unfairly, and state what it would like the FOS to do. The FOS will then assess whether it can consider the complaint and, if so, will investigate independently.
Data from FOS on payment complaints
The Financial Ombudsman Service publishes data on the complaints it receives, including those related to payment services. This data can provide insights into the common issues faced by businesses and consumers when dealing with card machine providers. According to the FOS, complaints about payment services have been on the rise in recent years, with issues such as unauthorised transactions, delayed settlements, and contract disputes being among the most common.
The FOS also reports on the outcomes of complaints, showing the proportion that are upheld in favour of the complainant. This information can be useful for businesses considering whether to escalate a complaint, as it indicates the likelihood of success. However, each case is decided on its own merits, and past outcomes do not guarantee future results.
Businesses can access the FOS's annual reports and quarterly data on its website to see the latest statistics on payment complaints. This data is part of the FOS's commitment to transparency and helps to hold financial businesses accountable for their conduct.
Eligibility and limits table
| Business size | FOS eligibility | Limit | Source |
|---|---|---|---|
| Micro-enterprise (fewer than 10 employees, turnover or balance sheet up to £2m) | Eligible | Up to £430,000 | FOS website |
| SME (fewer than 250 employees, turnover up to £50m or balance sheet up to £43m) | Eligible | Up to £430,000 | FOS website |
| Large enterprise (exceeds SME thresholds) | Not eligible | Not applicable | FOS website |
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Disclaimer. This guide is editorial information drawn from primary sources. It is not financial, legal or tax advice and does not recommend any provider. Figures are those published by the named sources on the review date and may change. Kael Tripton Ltd receives no commission, referral fee or lead payment from any provider named on this page. |
Frequently asked questions
Can a limited company complain to the Ombudsman?
Yes, a limited company can complain to the Financial Ombudsman Service if it qualifies as a micro-enterprise or an SME. The company must meet the size criteria, such as having fewer than 250 employees and an annual turnover not exceeding £50 million. If the company is larger, it is not eligible to use the FOS. The complaint must relate to a financial service, such as a card machine contract, and the company must have first given the provider 8 weeks to respond.
How long does the provider have to respond?
The payment provider has up to 8 weeks from the date it receives the complaint to give a final response. This is a regulatory requirement under the dispute resolution procedures. If the provider fails to respond within this period, or if the response is not satisfactory, the business can escalate the complaint to the Financial Ombudsman Service. The 8-week period is a key deadline that businesses should be aware of.
Is there a fee?
No, there is no fee for complaining to the Financial Ombudsman Service. The service is free for consumers and eligible businesses. The FOS is funded by levies on financial businesses and case fees, but complainants do not have to pay anything. This makes the FOS an accessible route for resolving disputes with card machine providers.
What is the maximum award?
The maximum award that the Financial Ombudsman Service can make is currently £430,000. This limit applies to the total compensation, including interest and costs. The actual amount awarded will depend on the specifics of the case, such as the financial loss suffered. If a business believes its loss exceeds this limit, it may need to consider court action, but the FOS is often a quicker and cheaper option.
Can FOS cancel the contract?
No, the Financial Ombudsman Service does not have the power to cancel or amend a contract between a business and a payment provider. The FOS can only direct the provider to pay compensation or take other corrective action, such as refunding charges. If a business wants to cancel a contract, it must rely on the contract terms or seek legal advice. The FOS can, however, consider complaints about unfair contract terms and may recommend changes.
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