Not upheld: irresponsible lending / affordability assessment complaint against National Westminster Bank Public Limited Company

Decision detail

Summary

Ms D complained that NatWest unfairly provided her with a £25,000 Bounce Back Loan in June 2020 that was unaffordable and inappropriate, and that the bank failed to conduct sufficient checks or ensure she understood the implications. The loan funds were transferred to her personal account and used for living costs after her business ceased trading, and she made no repayments, resulting in default and debt collection action. NatWest defended the complaint on the basis that the BBL was a non-advised, self-certified product under the government scheme designed for quick lending with minimal checks. The ombudsman did not uphold the complaint, finding that NatWest acted fairly by relying on Ms D's self-certification under the BBL scheme framework, and that as the loan was non-advised, the responsibility for understanding its implications rested with Ms D.

The Ombudsman's reasoning

The Bounce Back Loan Scheme was specifically designed to provide quick access to funding with minimal upfront checks, requiring applicants to self-certify eligibility and affordability. NatWest were entitled to rely on Ms D's declarations and were not expected to carry out detailed affordability assessments or verify turnover. As the loan was provided on a non-advised basis, the responsibility for understanding the loan's implications rested with Ms D. There was no evidence that NatWest knew or ought to have known the application contained incorrect information or that Ms D had specific vulnerabilities requiring intervention.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website