Not upheld: irresponsible lending - credit limit increase complaint against NewDay Ltd trading as Pulse

Decision detail

Summary

Ms B complained that NewDay lent to her irresponsibly by providing an initial credit card and five subsequent credit limit increases. The FOS determined it could only consider CLI5 (January 2020) as earlier complaints were time-barred under FCA rules. NewDay had conducted income and expenditure checks, reviewed Ms B's credit file and account usage, and found her to have approximately £18,000 in other credit that was up to date and that she rarely maxed out her credit limit. The ombudsman upheld NewDay's position that the checks were reasonable and proportionate, and rejected Ms B's arguments about narrow snapshots and undisclosed gambling problems, finding no evidence of irresponsible lending.

The Ombudsman's reasoning

The ombudsman found that NewDay carried out reasonable and proportionate checks before offering CLI5 by reviewing the credit file, account usage, and conducting income and expenditure assessments. The snapshot nature of affordability assessments is standard practice and does not constitute irresponsible lending. NewDay considered Ms B's overall indebtedness and account trajectory. There was no obligation for NewDay to review bank statements, and Ms B did not disclose her gambling problem, so NewDay could not have been expected to know about it.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website