Not upheld: irresponsible lending - affordability complaint against MBNA Limited

Decision detail

Summary

Miss M complained that MBNA irresponsibly lent her £8,000 in May 2025 when she could not afford the £176.48 monthly repayments and was already struggling with existing debts. MBNA had obtained Miss M's income details, expenditure information, and conducted a credit search showing no defaults or adverse information. The ombudsman found MBNA's checks were proportionate and the repayments appeared affordable based on the information gathered. Although Miss M subsequently experienced financial difficulty, the ombudsman concluded that even more extensive checks would not have demonstrated the loan was unaffordable, and therefore did not uphold the complaint.

The Ombudsman's reasoning

MBNA was required to carry out proportionate checks to ensure responsible lending. The checks carried out were proportionate for an early-stage lending relationship. The credit check showed no adverse information, and when existing credit repayments and reasonable expenditure estimates were deducted from validated income, the loan repayments appeared affordable. Even if MBNA should have obtained actual living expenses or bank statements, the information Miss M provided suggested this would not have shown the repayments to be demonstrably unaffordable. Bank statements were not proportionate to obtain given the relatively low monthly payments compared to income and the absence of significant credit issues.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website