Student finance maintenance loan paid into someone else’s bank

Hi ,

Has anyone been in this situation before or have any advice.


Basically a few weeks back I updated my bank details online with student finance as I noticed that one digit was wrong. On Monday 16th September student finance sent the payment to the incorrect bank details.

I telephoned them immediately, and they deny all knowledge of me updating it previously. They have done a 30 day payment trace and that’s all they will do they have told me I am liable for the funds if they can not be returned I.e the other person has spent them.

I have contacted the financial ombudsman and my bank who have both confirmed that student finance need to do a payment recall not a trace. In 2016 a system was implemented by fsa where by any payments in wrong accounts can be ringfenced for 30 days. Ombudsman and my bank have confirmed that student finance need to contact my bank ASAP.

Student fiancé are refusing to do this and will only do a trace.

The payment has also gone to the same bank as mine santander.

I am extremely stressed with this situation i am a mature student with a family and financial commitments. I am now about to Leave the course as it’s full time nhs and without any finance it’s not an option for me. Having gave up full time work to do this course.

I just do not know what else to do or where to turn. I have an appointment with student services 2morrow but doubtful they can help due to my partner being employed yes he has a wage which pays all the bills but then we have nothing to live on. Not entitled to universal credit as the finance takes us to high as they count it pound for pound and they are still counting it even though I have not had the payment and may never get it.

Sorry for the long story , feeling stressed and desperate

Unusual situation and you have done a lot of the right things.
You just want one thing to work to stop the money being withdrawn.
I would do the following :

1. Ombudsman. You should find out on what basis they think they should do a recall v get sfe to explain why they are only willing to do a trace.
I would try and find the legal basis for this.

2. I would also contact your MP.

3. I would also contact the fraud department at Santander and inform them that a payment was in dispute and it had been paid to the wrong person, even if mistakenly SFE believe it wnet to the right account, your identity would take precedence. I.e if it was intended for Mrs A, but went to Mr B, even though it was a stated account, then it was obviously not going to the correct people.

4. They could check with SFE whether the name on the account matched the intended recipient. Obviously it will not which should raise enough of a question about the payment they could freeze it.

5. I might also go down to the court and try to get an injunction from a judge to either freeze payment for that account or to force SFE to recall.

6. Finally I would raise an official complaint with SFE using their complaints system. It all sounds very suspect they will not help. If the account payee and bank number did not both match on their records then they should be querying it.

7. You might also want to open a complaint against Santander if they arent willing to do anything as it should be account payee only. Tell them what the Ombudsman said.

8. Also useful if you could prove the update. It should be whatever is on there now.


That is where I would be looking off the top of my head. It is imperative you act as quickly as possible.
Let us know how you get on.