Not upheld: credit file reporting and arrears handling complaint against Creation Consumer Finance Limited

Decision detail

Summary

Mrs W complained that Creation Consumer Finance Limited unfairly cancelled her direct debit after a debt management company purported to act on her behalf, causing arrears to accrue and be reported to her credit file. Creation cancelled the direct debit based on written authority and reported a '1' status code reflecting one month of arrears from July to November 2025. The ombudsman found that Creation acted fairly in both cancelling the direct debit and reporting the arrears, as the status code was consistent with ICO guidance and Creation communicated appropriately with Mrs W. Although Mrs W's credit score app showed missed payments, the ombudsman noted that full credit files use status codes that more accurately reflect the position, and Creation provided monthly balance updates showing arrears reducing. The complaint was not upheld and no remedy was ordered.

The Ombudsman's reasoning

The ombudsman found that Creation acted fairly in cancelling the direct debit based on written authority from the debt management company, and that Creation communicated appropriately with Mrs W about the arrears. The ombudsman determined that the '1' status code reported to the credit file was consistent with ICO guidance and Creation's reporting obligations, as it accurately reflected that the account was one month in arrears. Although Mrs W's credit score app showed missed payments, the ombudsman noted that such apps do not display credit data in the same way as full credit files, which use status codes. The ombudsman considered that an arrangement marker would have been inappropriate given Mrs W was overpaying rather than paying less than the contractual amount. The ombudsman suggested Mrs W could place a notice of correction on her credit file if still concerned.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website