Not upheld: Irresponsible lending complaint against Zopa Bank Limited

Decision detail

Summary

Mr S complained that Zopa Bank Limited irresponsibly lent him £9,000 in March 2025, arguing that the lender relied on modelling rather than his actual financial position and should have conducted further checks given his multiple credit agreements and arrears history. The ombudsman found that Zopa should have made further proportionate checks due to Mr S being in arrears for five of six months on a hire purchase agreement, but determined that bank statements would have shown sufficient disposable income and no financial difficulties. The ombudsman concluded that even with further checks, Zopa would have approved the loan as the repayments were affordable and sustainable based on Mr S's actual bank statements showing no returned payments, no overdraft usage, and significant discretionary spending. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that while Zopa should have conducted further checks due to Mr S's significant arrears history on the hire purchase agreement, the bank statements Mr S provided to the FOS showed he had sufficient disposable income and no financial difficulties on his main account. The statements demonstrated no returned payments, no overdraft usage, and substantial non-essential spending, indicating the loan repayments would have been affordable and sustainable. Therefore, even if Zopa had reviewed the bank statements as part of proportionate checks, they would have reached the same fair lending decision to approve the loan.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website