Lloyds Bank PLC · DRN-6191279

The complaint Mr and Mrs W have complained about the exchange rate that Lloyds Bank PLC (“Lloyds”) applied to a large international payment. What happened Mr and Mrs W wanted to send a large sum of money abroad from their joint account. Mr and Mrs W visited a Lloyds branch a number of times in May 2025 to find out what the process was and to ask about fees. Mr and Mrs W say they were told that there was a £9.50 transaction fee, but the branch staff couldn’t say what exchange rate they would get. Mr and Mrs W made a test payment of 1000 CZK (Czech koruna) on 23 May 2025, and this was confirmed as received by the receiving bank. To gain an idea about how much it’d cost to make such a payment, Mr and Mrs W received a quote from another payment service provider. Mr and Mrs W say they expected Lloyds to charge a higher amount than this, but were apparently comfortable using Lloyds despite this expectation. Mr and Mrs W went into a branch on the morning of 2 June 2025 to make the payment. But concerned that the payment could be a scam, Lloyds asked Mr and Mrs W if they had verified the account details over the phone. Mr and Mrs W left the branch to speak to the person responsible for receiving the payment. They then went back to the branch in the afternoon on 2 June 2025 to make the payment. Before the payment was made, Mr and Mrs W had checked the mid-market exchange rate for this transaction, and saw that the exchange rate was 29.488 CZK to the pound, at that time. After some time, a member of staff provided Mr and Mrs W with a printout. This explained that there was a fee of £9.50 to make the payment. It also confirmed the exchange rate that would be applied to their payment would be 29.06 CZK to the pound. Although the rate was a fair bit different to the market rate they’d seen earlier on, they chose to go ahead with the payment. After Mr and Mrs W made the payment, they felt that the exchange rate that Lloyds had given them was not as competitive as it should’ve been, so they complained to Lloyds, as they felt that the spread applied to the exchange rate was excessive. In response, Lloyds acknowledged there were some delays in branch on the day of the payment. It acknowledged that the exchange rate did fluctuate on the day. So, Lloyds agreed to make a goodwill offer of £750. This amount was based on the difference in what they would’ve received, between the best and worst rate that Mr and Mrs W could’ve secured with Lloyds on that day.

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Mr and Mrs W didn’t accept Lloyds’ offer. They said that they were expecting the transaction to cost around £2,000, based on a quote they’d received from another payment service provider. They said they would accept £4,000 in compensation, to cover the extra amount they say they were charged due to the spread applied to the transaction. After Mr and Mrs W referred their complaint to this service, one of our investigators assessed the complaint and overall, they thought that Lloyds’ offer was fair in the circumstances. 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. Having considered everything, I don’t uphold this complaint for broadly the same reasons that the investigator gave. I will explain why. My role is to look at problems that Mr and Mrs W experienced and see if Lloyds has done anything wrong or treated them unfairly. The crux of Mr and Mrs W’s complaint is regarding the exchange rate Lloyds applied to a large outbound international payment. Mr and Mrs W are unhappy with the exchange rate used and want Lloyds to make up the difference in the rate Lloyds used and the rate that another financial provider could’ve likely provided them with. It might be helpful for me to say here that I don’t have the power to tell Lloyds what exchange rates it has to offer to customers when foreign currency payments are made. This is a commercial decision and not something for me to get involved with. We offer an informal dispute resolution service and we have no regulatory or disciplinary role – that’s the role of the regulator, in this case the Financial Conduct Authority (FCA). That said, while I won’t tell a business what products or services it needs to offer or how much it is entitled to charge for this, I would expect that any information it does provide to its customers - needs to be accessible to them and communicated in a clear, fair and non- misleading way. And in Mr and Mrs W’s case I think it was. I say this as I can see that Lloyds’s website provides all the important information about the exchange rates Lloyds uses and details that Lloyds uses its own exchange rate to process payments. This includes a margin (also known as a spread) which is the difference between the exchange rate it offers its customer and the wholesale rate at which Lloyds can buy and sell currency in the foreign exchange markets. Lloyds also provides a calculator so that its customers can work out what margin is likely to apply, depending on how much they are sending. Mr and Mrs W say they checked the mid-market rate exchange rate before making the payment. And I can see that, before deciding whether to proceed with the payment, they were provided with a printout. This confirmed that there was a £9.50 charge to make the payment and it displayed what exchange rate they would get if they proceeded to make the payment with Lloyds. This print out also stated how much in GBP would be deducted from their account if they went ahead with payment, as well as the amount in CZK that would be received by the payee. Mr and Mrs W say they were aware there was quite a difference between the mid- market exchange rate and the exchange rate that Lloyds offered. But despite this, they chose to proceed with the payment anyway. However, I can’t reasonably hold Lloyds

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responsible because, with the benefit of hindsight, they now regret choosing to proceed with the payment. Mr and Mrs W also say the costs of the transaction were not made clear to them. But I disagree. They were already aware of the mid-market exchange rate before they were given the exchange rate that Lloyds could provide them with. And both the mid-market rate and Lloyds printout both quoted how much GBP would be deducted from their account. So they had an opportunity to compare the two rates, and were able to establish, quite easily, what the difference in the two rates would mean to them in monetary terms. Because of this, I’m satisfied that they had enough information in which to make an informed decision about whether they wanted to proceed with the payment using Lloyds’ offered rate, or to shop around elsewhere for a better rate. By agreeing to proceed with the payment, Lloyds was providing a service which it was entitled to charge for. I haven’t seen anything to show me that Lloyds agreed to apply a different rate or that it failed to apply the rate as outlined in the printout that was given to Mr and Mrs W, before deciding to proceed with the payment. And the payment looks to have been processed in line with what is stated on Lloyds’ website and its terms and conditions. So having considered everything, whilst I recognise that a lot of money was at stake in making the international payment, I don’t think that Lloyds has made an error or treated Mr and Mrs W unfairly here. Finally, I note that there was some delay in Mr and Mrs W making the payment on 2 June 2025. Although I can see that Mr and Mrs W were baffled by some of the questions and concerns that Lloyds staff had about the payment, I believe these concerns (for example checking if they’d had verified the account details over the phone) were to ensure that Mr and Mrs W were not being scammed. I recognise that it may’ve been frustrating for Mr and Mrs W. And this led to them having to leave branch and then come back in the afternoon. But I’m satisfied that this was only because the Lloyds staff were acting in Mr and Mrs W’s best interests, and I can appreciate why they may’ve exercised an abundance of caution, given the large amount of the payment. Nevertheless, I can see that it took a considerable amount of time for the payment to be made on 2 June 2025, and so I think paying Mr and Mrs W £750 to cover the maximum difference in exchange rates for CZK on the day, is a fair way to reflect that delay. Therefore, whilst I understand why Mr and Mrs W may now regret accepting the exchange rate that Lloyds offered them, given the large sums involved, I can’t say that Lloyds acted unfairly or unreasonably here. And so, I don’t think that Lloyds needs to do anything further in relation to this matter. My final decision Because of the reasons given above, I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr W and Mrs W to accept or reject my decision before 24 April 2026. Thomas White Ombudsman

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