Not upheld: Irresponsible lending complaint against Barclays Bank UK Plc

Decision detail

Summary

Mr R, a sole trader, complained that Barclays behaved unreasonably by maintaining an overdraft facility he considered unaffordable and by providing a Bounce Back Loan that added to his financial burden. He also complained about the administration of a resolver loan offered in October 2024 when he disclosed financial difficulty due to health deterioration. The ombudsman found that complaints about the 2017 overdraft grant and 2018 renewal were outside jurisdiction due to time limits. For the remaining complaints, the ombudsman found that Barclays' annual reviews and renewals from 2019 onwards were reasonable given Mr R's business account activity showed occasional small overdraft exceedances, available limit, and regular credits, and that Mr R did not raise affordability concerns until October 2024. The ombudsman also found the resolver loan process was adequately explained and the BBL was provided in accordance with government scheme rules. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied strict FCA DISP time limit rules and found that complaints about the 2017 overdraft and 2018 renewal were outside jurisdiction as they were brought more than six years after the events and more than three years after Mr R should have become aware of cause for complaint. For the 2019 onwards renewals, the ombudsman found that business customers have different expectations regarding overdraft utilization compared to consumers, and that occasional small exceedances for short periods would not necessarily alert a lender to financial difficulty. The ombudsman noted that Mr R had available limit, regular credits to the account, and did not raise concerns until October 2024, at which point Barclays offered support. The ombudsman found the resolver loan process was adequately explained and that the plan cancellation was reasonable given the overdraft limit was exceeded and affordability checks were required. The ombudsman found the BBL was provided in accordance with government scheme rules based on self-declared information.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website