Not upheld: irresponsible lending complaint against Mitsubishi HC Capital UK PLC trading as Novuna Personal Finance

Decision detail

Summary

Mrs O complained that Novuna failed to lend responsibly when agreeing a £25,000 personal loan in March 2020. The ombudsman found that Novuna performed reasonable and proportionate affordability checks, which included reliance on Mrs O's declared income and Novuna's own income estimation, both showing good affordability. Mrs O's credit report showed no defaults or missed payments, and she had been affording all existing borrowings. The ombudsman concluded there was insufficient evidence that Novuna should have made further enquiries or refused the credit, and therefore did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that Novuna's affordability checks were reasonable and proportionate given the credit being granted. The information available to Novuna at the time, including both declared income and their own estimations, demonstrated sufficient affordability. The absence of any defaults or missed payments in Mrs O's credit history provided no notice that further enquiries were necessary or that credit should be refused. Based on the totality of information gathered, there was nothing to suggest Mrs O would be unable to sustainably repay the loan.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website