Not upheld: premature default reporting and credit file accuracy complaint against Barclays Bank UK PLC trading as Barclaycard

Decision detail

Summary

Mr J complained that Barclaycard unfairly reported his credit card account as defaulted to credit reference agencies, arguing it was reported prematurely (four days before the deadline in the Default Notice) and that he would have cleared the arrears had he received the notice in time. Barclaycard partially upheld the complaint, acknowledging the premature reporting and offering £25 compensation. The ombudsman found that while the default was reported four days early, the default status itself was a fair reflection of Mr J's payment history—he had missed at least four consecutive months of payments and was in breach of his contractual obligations, consistent with industry guidance. The ombudsman rejected Mr J's claim that he would have paid the arrears, noting his long-term financial difficulties, poor payment history over 24 months, and the fact that his credit file balance remained static after the default. The ombudsman upheld the complaint only to the extent of directing Barclaycard to pay £200 compensation for the premature reporting error, but did not require removal of the default from his credit file.

The Ombudsman's reasoning

The ombudsman found that while Barclaycard prematurely defaulted the account by four days, the default itself was a fair and accurate reflection of Mr J's payment history. The account was at least four months in consecutive arrears, which aligns with ICO guidance that defaults may be recorded when an account is three months in arrears. The ombudsman was not persuaded by Mr J's argument that he would have cleared the arrears by the deadline, noting his long-term financial difficulties evidenced by missing more payments than he made over 24 months, and the fact that his credit file balance remained static after the default, suggesting he lacked the financial means to pay. Although the Default Notice was correctly addressed and sent, the ombudsman acknowledged the premature reporting as an error warranting compensation.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website