Not upheld: irresponsible lending complaint against MBNA Limited

Decision detail

Summary

Miss H complained that MBNA acted irresponsibly by approving a credit card with a £6,000 limit in January 2024 (increased to £7,500 in July 2025) without sufficient checks, given her variable contractor income, recent mortgage, multiple credit cards, and reliance on credit. MBNA conducted proportionate checks including income verification through CATO data, credit file checks, and assessment of disposable income, finding she had £829-£840 monthly disposable income after essential costs and existing commitments, with no adverse credit history or missed payments. The ombudsman upheld MBNA's position, finding the checks were reasonable and proportionate, the information was fairly considered, and the lending decisions were fair given Miss H's demonstrated ability to manage credit and maintain repayments. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that MBNA carried out proportionate checks appropriate to the type and amount of credit being offered. The checks included verification of income through CATO data, assessment of essential living costs and existing commitments, and credit file checks. The information obtained showed Miss H had sufficient disposable income to afford the credit (£829 at opening, £840 at increase), no adverse credit history, and was managing existing credit well. The ombudsman concluded that based on this information, it was fair for MBNA to lend and increase the limit. The fact that Miss H's income was variable and she had recently taken on a mortgage did not change this conclusion, as MBNA used her declared income and validated it through actual bank data. The ombudsman also found no evidence prior to the complaint that should have prompted MBNA to take further action regarding financial difficulties.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website