Not upheld: irresponsible lending complaint against Santander UK Plc

Decision detail

Summary

Miss W complained that Santander UK Plc irresponsibly provided her with a credit card in March 2022 (initial limit £3,800) and increased it to £4,800 in October 2023. The ombudsman found that while Santander did not provide evidence of the credit checks they claimed to have conducted, reasonable and proportionate checks would not have shown the lending was unfair. At both account opening and the time of the credit limit increase, Miss W's income appeared sufficient to cover her mortgage, living costs, existing credit commitments, and new credit card repayments. Her credit file showed no financial difficulties, she was managing creditors well, and was not over-indebted. The ombudsman rejected the argument that Miss W's subsequent financial difficulties proved the credit was unaffordable, concluding these resulted from multiple factors Santander could not have anticipated. The complaint was not upheld.

The Ombudsman's reasoning

Although Santander did not provide evidence of the credit checks they claimed to have carried out, the ombudsman considered what proportionate checks would have revealed. Based on Miss W's financial circumstances at both account opening and at the time of the credit limit increase, reasonable checks would not have shown it was unfair to provide the credit. Miss W's income appeared sufficient to cover her mortgage, living costs, existing credit commitments, and the new credit card repayments. Her credit file showed no financial difficulties, she was not over-indebted, and she was managing her creditors well. The ombudsman rejected the argument that Miss W's subsequent financial difficulties proved the credit was unaffordable, noting these appeared to result from multiple factors that Santander could not have foreseen.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website