Not upheld: irresponsible lending - inadequate affordability checks complaint against National Westminster Bank Public Limited Company (NatWest)

Decision detail

Summary

Mr B complained that NatWest irresponsibly lent to him when providing a £10,000 credit card in September 2023, arguing that insufficient affordability checks were undertaken. NatWest defended the decision, stating they had carried out proportionate checks that revealed no concerns. The ombudsman found that NatWest's checks - including CRA data review, income verification, and affordability assessment - were proportionate and revealed no cause for concern, with Mr B appearing to have significant disposable income of approximately £1,250 monthly. Although Mr B later experienced financial difficulties in 2025 and claimed to have made missed payments, these were not evident in the CRA data available to NatWest at the time of the lending decision. The ombudsman rejected Mr B's arguments regarding precedent from other cases, the significance of his high debt-to-income ratio, and claims that NatWest should have accessed additional information, concluding that NatWest acted fairly and reasonably in providing the credit.

The Ombudsman's reasoning

The ombudsman found that NatWest's affordability checks were proportionate to the circumstances of the lending. The checks revealed no cause for concern - no defaults, CCJs, or IVAs were present, and Mr B appeared to have well-managed credit with significant disposable income (approximately £1,250 monthly). While Mr B argued he was in a worse financial position than NatWest concluded, the ombudsman held that NatWest could legitimately rely on the CRA data returned to them, which did not evidence the missed payments or cash withdrawals Mr B referenced. The ombudsman rejected arguments about precedent from other cases, noting each case must be assessed on its own merits. A high debt-to-income ratio alone is not necessarily a sign of financial difficulty and must be considered alongside other factors. The ombudsman also rejected arguments that NatWest should have accessed additional information through a financial investment in another provider, and noted that personal difficulties Mr B later experienced were not disclosed at the time of lending.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website