The UK Financial Ombudsman Service (FOS) has announced plans to introduce a new fee structure to charge professional representatives £250 to refer a case from 1 April.

This proposal is part of FOS’ plan to create “fairer” funding arrangements and improve complaint submissions.

Professional representatives can refer up to ten cases a year for free. If a complaint is upheld, a £175 credit reduces the fee to £75, the FOS said in its release.

Financial service companies currently pay a £650 fee for complaints against them while professional representatives do not. Under the new rules, if a complaint is not upheld or withdrawn, the business will pay a reduced fee of £475 instead of £650. This change aims to encourage better-evidenced complaints.

Between April and December 2024, 47% of complaints were from professional representatives, but only 26% were upheld compared to 38% from direct consumer submissions, the FOS said.

The service will be free for direct submissions, families, friends, charities, and voluntary organisations.

An enhanced digital service requires representatives to provide evidence early, expediting processes and dismissing inappropriate complaints.

FOS interim chief ombudsman James Dipple-Johnstone said: “We’ve seen more cases brought by professional representatives, but fewer of these cases leading to a better outcome for their clients.

“Currently, there is little commercial incentive for representatives to ensure the complaints they bring are well-founded or have merit. As a not-for-profit service, we expend our finite resources handling thousands of withdrawn or abandoned cases, which can lead to longer wait times for other customers.

“The charges we are introducing from April will bring better balance to our fee model, helping us to resolve disputes quickly and ensuring a wider contribution towards our running costs.”