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

Decision detail

Summary

Miss H complained that NatWest lent irresponsibly when approving a £2,500 credit card in October 2021, arguing the lender failed to conduct sufficient affordability checks given her variable contractor income, existing unsecured debt, and reliance on credit. NatWest carried out CRA checks and income verification, finding Miss H had declared full-time employment of £28,541 annually, monthly disposable income of £685, and existing credit of £650 being well-managed. The ombudsman found the checks were proportionate and reasonable, and the account history showed Miss H remained within limits, made timely payments, and paid significantly above minimums with no clear signs of financial difficulty. The complaint was not upheld as the ombudsman concluded NatWest acted fairly and reasonably in their lending decision.

The Ombudsman's reasoning

The ombudsman found that NatWest's proportionate checks were reasonable and satisfied regulatory requirements. The checks showed Miss H had low existing credit commitments, healthy disposable income of £685 monthly, and even after taking the new credit into account, would retain approximately £560 disposable income. The account history demonstrated Miss H remained within limits, made timely payments, and paid significantly above minimums, with no clear indicators of financial difficulty evident to NatWest prior to the complaint. The ombudsman concluded the lending decision was fair and there was insufficient evidence to suggest NatWest should have conducted further investigations.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website