Not upheld: Irresponsible lending complaint against Great Western Credit Union Limited

Decision detail

Summary

Mr R complained that GWCU unfairly pressured him for repayments on a 2019 loan after his PIP was mistakenly stopped, charged excessive interest, reduced a subsequent loan application, and closed his local branch without adequate consideration of his disability needs. The ombudsman found that GWCU's contact records did not show unreasonable harassment, the interest charged was minimal (£89.21 over four years), the firm corrected an administrative error fairly, and the branch closure followed a fair process with consultation of identified regular users. Mr R had successfully used online banking since 2021 and was not identified as requiring face-to-face services. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that GWCU's contact records did not show unreasonable harassment regarding repayments, and the firm was entitled to seek updates on Mr R's PIP reinstatement. The interest charged (£89.21 over four years on a 3% monthly rate) was minimal and fair, and although GWCU made an error in applying repayments to interest between April 2020 and March 2021, it corrected this fairly. GWCU acted responsibly in reducing the loan amount in the 2023 application based on payment history, which is a legitimate lending consideration. Regarding branch closure, GWCU followed a fair process by reviewing users, consulting with the 24 identified regular users, and offering alternative support. Mr R was not identified as requiring face-to-face banking as he had successfully used online banking since 2021. The branch closure decision was proportionate to GWCU's size and the minimal usage. Customer service issues were minor, with one call handled less well but another handled professionally and sympathetically.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website