Not upheld: handling of account during financial difficulty; appropriateness of default and account termination complaint against Gain Credit LLC (trading as Drafty)

Decision detail

Summary

Miss P complained about Drafty's handling of her revolving credit account after she fell into financial difficulty. Drafty had established a payment arrangement in November 2024 with reduced payments of £22 per month and froze interest. When Miss P could not afford the standard £119 payment in May 2025, an income and expenditure assessment showed she had no disposable income. After sporadic payments below the required amount, Drafty issued a default notice in November 2024 and terminated the account. Miss P disputed that a formal arrangement existed, objected to the default while her complaint was pending, and referenced her vulnerabilities. The ombudsman found that Drafty handled the situation appropriately and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that Drafty took appropriate steps to assist Miss P by establishing a formal payment arrangement with reduced payments, freezing interest, and placing a temporary hold on the account. The lender properly requested an income and expenditure assessment when Miss P could not afford the standard payments, and when this showed no disposable income, there was no realistic prospect of an amended repayment plan being affordable. The ombudsman rejected Miss P's argument that no formal arrangement existed, noting that Drafty reported it as such to credit reference agencies, which would have been more beneficial to her than reporting arrears. The ombudsman also rejected the argument that the account should not have been defaulted while a complaint was pending, as delaying the default would have extended the period it remained on her credit file.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website