Partially upheld: unfair account termination and poor communication during financial difficulty complaint against NewDay Ltd (trading as Marbles)

Decision detail

Summary

Miss F complained that NewDay unfairly terminated her Marbles credit card account after she disclosed financial difficulties following job loss. NewDay had implemented a 90-day payment pause and offered a repayment plan, but Miss F did not pursue it initially. When she called on 22 April 2025 to set up a plan, NewDay failed to inform her that the account had already been terminated and the default notice deadline had passed. The ombudsman found that while NewDay's initial response to her financial difficulties was reasonable and the termination itself was fair under the Consumer Credit Act 1974, the firm should have clearly communicated on 22 April 2025 that termination had already occurred. The complaint was partially upheld and compensation of £110 total was ordered for the distress and inconvenience caused by the poor communication.

The Ombudsman's reasoning

The ombudsman found that NewDay's initial response to Miss F's financial difficulties was reasonable and appropriately tailored, including the 90-day payment pause and clear warnings about termination. The account had already been terminated before the 22 April 2025 call, so Miss F did not lose a realistic opportunity to prevent termination. However, NewDay should have clearly communicated during that call that the account had already been terminated, rather than allowing Miss F to believe there was still a chance to avoid it. While Miss F's vulnerability and reliance on the credit facility were important considerations, they did not obligate NewDay to continue providing credit when the account was three months in arrears and the default notice had expired. The poor communication caused distress and inconvenience warranting compensation.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website