Not upheld: unfair default registration complaint against Vanquis Bank Limited

Decision detail

Summary

Mr A complained that Vanquis Bank Limited unfairly registered a default on his credit card account, claiming the bank's app did not show he was in arrears and that he had disclosed a mental health condition requiring app-only account management. Vanquis served a default notice on 17 July 2025 when Mr A was at least 3 months in arrears, requiring payment or arrangement by 14 August 2025, which Mr A did not meet. The ombudsman found the default registration was fair as it fell within the expected timeframe under ICO guidance, Mr A would have reasonably known of arrears through multiple communications and statements, and Vanquis had no record of the vulnerability disclosure at the time. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied ICO guidance which indicates defaults may reasonably occur when a borrower is 3 months in arrears and normally by 6 months in arrears. Mr A was at least 3 months in arrears when the default notice was served, falling within the expected timeframe. The ombudsman found Mr A would have reasonably known of his arrears through multiple channels: the app (which likely reflected contractual payments due), credit card statements showing missed payments, telephone calls discussing arrears, and letters including a default notice warning of consequences. Although Mr A claimed vulnerability due to mental health, Vanquis had no record of this disclosure at the relevant time, and Mr A failed to mention it during arrears discussions. Even accepting vulnerability, the combination of app information and telephone calls would have made Mr A reasonably aware of non-payment. Critically, Mr A did not respond to the default notice by the deadline of 14 August 2025 by making payment or arranging a plan, indicating the relationship had broken down.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website