Not upheld: Goods and services under S75 complaint against Zopa Bank Limited trading as Zopa

Decision detail

Summary

Mrs J purchased a used car for £10,790.00 under a hire purchase agreement with Zopa in April 2025. In July 2025, after three months and 3,656 miles of use, the car was diagnosed with missing DPF and AdBlue systems with an ECU remap. Zopa agreed to reject the car and offered compensation totalling £783.23, including refunds of some payments, insurance, road tax, and £250.00 for distress. Mrs J complained that Zopa should refund all her payments and costs. The ombudsman found that while the car was of unsatisfactory quality, Zopa was entitled to deduct for fair usage under the Consumer Rights Act 2015, and that the compensation offered was fair and reasonable given the circumstances.

The Ombudsman's reasoning

The ombudsman applied the Consumer Rights Act 2015, which requires goods to be of satisfactory quality. While the car was undisputed to be of unsatisfactory quality, the ombudsman considered what constituted fair compensation. The ombudsman allowed Zopa to make a deduction for fair usage of the car (3,656 miles over 3 months), finding that retaining the full £876.21 in payments would have been reasonable. However, the ombudsman agreed that Mrs J should be refunded for insurance and road tax costs incurred after the fault was identified (16 July 2025), calculating £236.46 for insurance and £25.87 for road tax. The ombudsman found the £250.00 distress and inconvenience payment reasonable given Zopa's quick agreement to rejection. The ombudsman concluded that Zopa's total payment of £783.23, when accounting for interest, met or exceeded what would be fair compensation.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website