Not upheld: irresponsible lending complaint against Madison CF UK Limited trading as 118 118 Money

Decision detail

Summary

Mr H complained that Madison CF UK Limited trading as 118 118 Money lent irresponsibly when providing a £1,500 loan in August 2024. The ombudsman found that while the firm's initial checks were not sufficiently proportionate given Mr H's credit history (which included four historic defaults, recent missed payments, and recent short-term borrowing), further proportionate checks would likely have shown the lending was fair. With verified monthly income of approximately £3,500, essential costs of £1,250, and existing credit repayments of £330, Mr H had sufficient disposable income to sustainably repay the loan. The complaint was not upheld and no remedy was ordered.

The Ombudsman's reasoning

While 118 118 Money should have undertaken further proportionate checks given the credit check results showing historic defaults and recent payment difficulties, the ombudsman concluded that such checks would likely not have revealed the credit was unfair to provide. Based on Mr H's verified income of approximately £3,500 monthly, essential costs of £1,250, existing credit repayments of £330, and additional expenses of approximately £500, there was sufficient disposable income to sustainably repay the £1,500 loan. The ombudsman noted that the private loan to a family member would not have appeared on a credit check and could not be assumed to have been identified through further checks.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website