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information for businesses covered by the ombudsman service

This section answers a number of frequently-asked questions (FAQs) about:

how we award redress

basis of compensation

on what basis am I expected to pay compensation to the consumer, if you uphold a complaint against me?

Any redress we award will depend on the individual circumstances of the case - taking into account what we think has gone wrong and how we decide the matter needs to be put right.

Generally speaking, where we uphold a complaint our aim is to put the consumer in the position they would now be in - financially - if the business providing the financial service hadn't got it wrong in the first place.

We can award redress in two ways:

telling the business what specific sum of money it should pay the consumer

This is called a "money award". We calculate the amount to cover any financial losses we decide the consumer has suffered as a result of the problem they have complained about.


telling the business what actions it needs to take to put things right for the consumer

Technically, this is called a "directions award", because we can direct the business to take whatever steps in relation to the complaint we consider are just and appropriate - whether or not a court could order those steps to be taken.

This could include, for example, directing the business to:

  • pay an insurance claim that had earlier been rejected
  • correct wrong credit references
  • calculate and pay redress according to an approach or formula set by the regulator (usually the case with mortgage endowment complaints)
  • apologise personally to the consumer.

In some cases - as well as or instead of a money or directions award - we may make an award for non-financial loss (pain and suffering, damage to reputation, distress or inconvenience).

We have produced special factsheets on redress in investment and mortgage endowment cases:

a quick guide to ... calculating redress in investment complaints

a quick guide to ... calculating redress for mis-sold mortgage endowments