Upheld: irresponsible lending - inadequate affordability assessment complaint against Clydesdale Bank Plc, trading as Virgin Money
Financial Ombudsman decision DRN-5948502 of 2026-04-13T00:00:00+00:00. irresponsible lending - inadequate affordability assessment complaint against Clydesdale Bank Plc, trading as Virgin Money. Outcome: Upheld.
Decision detail
| Reference | DRN-5948502 |
|---|---|
| Decision date | 2026-04-13T00:00:00+00:00 |
| Firm | Clydesdale Bank Plc, trading as Virgin Money |
| Product | Credit card |
| Claim type | irresponsible lending - inadequate affordability assessment |
| Outcome | Upheld |
| Remedy | Virgin Money must: (1) add up total repayments made by Mrs C and deduct from total amount received; (2) if overpaid, refund overpayments with 8% simple interest per year from date of overpayment; (3) if balance remains, arrange affordable payment plan; (4) remove all adverse information regarding the account from Mrs C's credit file upon clearance or if overpaid. |
Summary
Mrs C complained that Virgin Money irresponsibly approved a £2,200 credit card in June 2021, arguing that insufficient checks failed to reveal unaffordable repayments given her other debts and gambling. Virgin Money relied on Mrs C's declared household income of £80,000 without verification, despite her modest personal income of £14,700, recent missed payment, and unexplained lack of rental payment despite declaring tenancy. The ombudsman upheld the complaint, finding that proportionate checks would have revealed significant gambling transactions in Mrs C's sole-name bank account, making approval unlikely. Virgin Money must refund interest and charges, arrange an affordable payment plan for any remaining balance, and remove adverse credit file information.
The Ombudsman's reasoning
The ombudsman found that while any single factor in isolation might not be material, the combination of factors (modest personal income, unverified household income, recent missed payment, unexplained lack of rental payment, and use of household income without verification or disclosure) meant proportionate checks were required. Bank statements would have revealed significant gambling transactions that would have made approval unlikely. Virgin Money's reliance on household income without verification or understanding of Mrs C's access to it was insufficient.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Clydesdale Bank Plc, trading as Virgin Money, all decisions | 62 | 20% |
| Credit card, all decisions | 25,211 | 22% |
Source
Read the original decision on the Financial Ombudsman Service website