Not upheld: loan withdrawal without adequate notice and communication complaint against Prodigy Finance Ltd

Decision detail

Summary

Mr I applied for a student loan with Prodigy Finance in April 2025 and paid a $500 USD processing fee after his application was matched with funding. Prodigy Finance issued pre-contract information on 13 June 2025 requiring acceptance within 14 days, but Mr I did not complete the acceptance steps. On 11 July 2025, Prodigy Finance withdrew the loan due to inactivity without notifying Mr I. Mr I only discovered the withdrawal on 5 September 2025 after his university course had started, and his UK visa had been refused on financial grounds. Prodigy Finance offered a refund of the fee and $100 USD compensation, but Mr I complained that this was insufficient given his financial loss and disruption to his studies. The ombudsman did not uphold the complaint, finding that dashboard evidence showed Mr I had not completed the required acceptance steps, and therefore Prodigy Finance acted fairly in withdrawing the loan, though it could have communicated better.

The Ombudsman's reasoning

The ombudsman found that while Mr I provided a copy of the pre-contract information, the dashboard screenshots from Prodigy Finance showed that Mr I accessed but did not complete the pre-contract information by marking it as read and accepting the terms. Although Mr I claimed he read and accepted the document on the dashboard, he could not provide evidence of this after losing dashboard access, and the available evidence did not confirm he completed the required acceptance steps. The ombudsman acknowledged that Prodigy Finance could have communicated better by notifying Mr I of the withdrawal before or at the time it occurred, but this did not make the withdrawal itself unfair given Mr I's failure to complete the required steps within the 14-day timeline.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website