Not upheld: irresponsible lending and account management complaint against NewDay Ltd trading as Fluid Credit Card

Decision detail

Summary

Mr B complained that NewDay lent irresponsibly when approving a £1,500 credit card in July 2021, arguing insufficient checks were carried out and the lending was unaffordable given his existing debts. He also complained about account management issues including a payment date change request not being accommodated, unfair removal of a 0% promotional offer, and poor treatment after disclosing mental health and financial difficulties. The ombudsman found NewDay's affordability checks were reasonable and proportionate, the lending decision was fair based on estimated disposable income of £855 monthly and no indicators of financial difficulty, and that NewDay acted with appropriate forbearance when Mr B later disclosed difficulties. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the regulatory requirement for proportionate checks considering the type, amount, duration and cost of credit alongside the borrower's circumstances. NewDay's checks were found reasonable given the information provided by Mr B and the credit limit amount. The lending decision was fair as Mr B appeared to have sufficient disposable income (£855 monthly) and no indicators of financial difficulty at the time. Regarding account management, the ombudsman found NewDay acted with forbearance when Mr B disclosed difficulties, providing payment holidays and breathing space. The account closure was not retaliatory but a consequence of the account remaining unaffordable after forbearance measures were exhausted.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website