Not upheld: irresponsible lending and unfair credit relationship complaint against Lloyds Bank PLC

Decision detail

Summary

Mr H complained that Lloyds lent to him irresponsibly when issuing a £5,700 credit card in September 2018, claiming his financial situation had deteriorated and the lending was unaffordable. The complaint was made in September 2025, over six years later. The ombudsman found that while Lloyds had not fully evidenced its affordability checks, reconstruction using Mr H's bank statements showed he had over £1,000 monthly disposable income and could sustainably afford the credit. The ombudsman also found that Lloyds took appropriate action when identifying minimum payments in June 2020 and that there was insufficient evidence Mr H was in financial difficulty or had requested support. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied Section 140A of the Consumer Credit Act 1974 to assess whether the lending relationship was unfair. While Lloyds failed to fully evidence proportionate affordability checks, reconstruction using Mr H's bank statements showed he had sufficient disposable income (over £1,000 monthly) to sustainably afford the credit. The ombudsman found no evidence that Mr H was reliant on credit to make ends meet or that the lending was unaffordable. Regarding post-lending conduct, Lloyds sent appropriate communications when minimum payments were identified, and there was insufficient evidence of financial difficulties to require earlier intervention, as Mr H did not contact Lloyds for support and any limit exceedances were quickly resolved.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website