Not upheld: irresponsible lending - inadequate affordability checks complaint against Amplifi Capital (U.K.) Limited trading as Reevo

Decision detail

Summary

Mr W complained that Reevo irresponsibly lent him £6,500 in March 2023 without completing adequate affordability checks. Mr W argued that if proper checks had been done, Reevo would have discovered the loan was unaffordable given his actual housing costs (£1,400 not £573.48) and credit commitments (£1,800 not £1,093). The ombudsman found that Reevo's checks were proportionate to the lending decision and that even using Mr W's actual higher figures, the loan appeared sustainably affordable with a substantial monthly buffer of approximately £1,100. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the proportionality test for affordability checks, considering the loan amount, repayment size, cost, and consumer circumstances. While Reevo underestimated housing costs, the ombudsman found this would not have changed the lending decision as the loan still appeared sustainably affordable. Using the higher £1,400 housing cost figure, Mr W would have approximately £1,100 remaining monthly for unaccounted expenses, which the ombudsman considered a substantial buffer. The ombudsman found Reevo reasonably relied on the credit check data and had no reason to suspect it was inaccurate or incomplete. The ombudsman concluded that Reevo's checks were proportionate and the lending decision was fair.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website