This section answers a number of frequently-asked questions (FAQs) about:
how is the Financial Ombudsman Service funded?
We are funded by levies and case fees which businesses we cover have to pay by law. Consumers do not pay to bring a complaint to the ombudsman. And we receive no government funding.
All businesses covered by the ombudsman service pay a levy to contribute to our costs. The amount of levy that each individual business has to pay can range from around £100 a year for a small firm of financial advisers to over £300,000 for a high-street bank or major insurance company.
Where a business has had no formal complaints referred to the ombudsman service, the levy is still payable. This is because all businesses benefit from the increased consumer confidence that the ombudsman brings.
And the ombudsman service's funding covers much more than our work settling cases. We carry out a wide range of complaints-prevention work, aimed at helping to stop problems turning into full-blown disputes.
For example, we publish our regular newsletter ombudsman news, our online technical resource, and our series of factsheets for consumers and guides for businesses. And we carry out an extensive outreach programme aimed both at consumers and businesses.
A business also has to pay an individual case fee, when we handle a complaint about it and the case becomes "chargeable" under our rules. However, all businesses covered by the ombudsman service are entitled to a number of "free" cases.
Case fee arrangements are reviewed each year and subject to change. Under the current arrangements, a business does not have to pay a case fee for the first 25 cases settled during the year. For the 26th case and each subsequent complaint, the business has to pay a case fee of £550.
From April 2012 to April 2014, we also charged a supplementary case fee of £350 for the 26th (and each subsequent) payment protection insurance (PPI) mis-selling case.
In April 2013, we introduced a group-charging account for the largest financial services groups. Around three quarters of our workload is now paid for on this more financially stable basis – by the businesses whose customers use us most.
In January each year we consult publicly on our plans and budget for the year ahead – including the amount to be raised through the levy and the level of our case fee.
For more details see our factsheet: