Not upheld: irresponsible lending and credit limit increases complaint against NewDay Ltd trading as Aqua

Decision detail

Summary

Miss B complained that NewDay Ltd irresponsibly lent to her by providing a credit card with an initial £450 limit and increasing it six times to £4,500 between 2022 and 2025, without adequate affordability checks. She also raised concerns about the Aqua Coach facility implying improved rates that never materialized. NewDay's affordability checks using CRA data and income verification showed no financial concerns, good payment history, and substantial disposable income at each decision point. The ombudsman found the checks proportionate, the lending decisions reasonable, and the Aqua Coach facility did not guarantee rate improvements. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the regulatory requirement for proportionate affordability assessments and found that NewDay's checks were appropriate to the circumstances. The data gathered from CRAs and Miss B's declarations showed no financial concerns, with Miss B demonstrating good credit management, no adverse credit history, and substantial disposable income at each lending decision point. The moderate increases spaced over time suggested sustainable lending rather than an unsustainable pattern. The Aqua Coach facility was found to be a credit building tool that did not guarantee improved rates. Financial difficulties that emerged in August 2025 occurred after the final lending decision and could not have been anticipated by NewDay.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website