Not upheld: Irresponsible lending complaint against Plata Finance Limited

Decision detail

Summary

Mr J complained that Plata Finance Limited failed to conduct a proportionate affordability check before approving a £7,500 loan in June 2025, arguing that proper checks would have revealed his gambling problem. Plata verified Mr J's income of £2,693 monthly, calculated his expenditure using credit file data and ONS statistics, and obtained a credit search showing no recent adverse payment information, total other debt of only £2,300, and no missed payments or judgements. Although Mr J later experienced repayment difficulties and required a payment plan, the ombudsman found these difficulties were not apparent at the time of application and that Plata's checks were fair and reasonable. The complaint was not upheld as the firm was entitled to rely on the information obtained and was not required to conduct further checks such as requesting bank statements.

The Ombudsman's reasoning

The ombudsman found that Plata's proportionate affordability checks were fair and reasonable for a first loan. The firm verified Mr J's income, calculated his expenditure using both credit file data and ONS statistics, and obtained a credit search showing no recent adverse payment information. While Mr J had high credit utilisation and some cash advances, these were not sufficient indicators of financial difficulty given the well-maintained accounts and absence of missed payments. The ombudsman concluded that obtaining bank statements would have been disproportionate given the lack of signs of financial difficulties, and that Plata could not have discovered Mr J's gambling problem from the information available at the time of application.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website