Partially upheld: payment processing error and technical oversight complaint against Link Financial Outsourcing Limited trading as Asset Link Capital (No.9)

Decision detail

Summary

Miss A complained that two loans totalling £11,000 advanced by Future Finance Loans Corporation Limited were unaffordable and that LFO improperly accepted credit card payments to repay them. The original lender no longer exists, preventing review of the lending decisions. However, the ombudsman upheld the complaint regarding credit card payments, finding that LFO's payments portal made a technical error in accepting such payments contrary to LFO's policy. The ombudsman rejected Miss A's request to reopen the loans and awarded £250 compensation for the processing error, finding this fair and reasonable as Miss A had benefited from using promotional credit card rates to reduce her interest burden.

The Ombudsman's reasoning

The ombudsman determined that while the original lending decisions were made by Future Finance (now dissolved), LFO could be held responsible for accepting credit card payments in breach of its own policy due to a technical error by its payments portal provider. The ombudsman found that although Miss A benefited from using promotional credit card rates to reduce her interest burden, LFO's mistake in accepting these payments warranted compensation. The ombudsman rejected the irresponsible lending complaint as it lacked jurisdiction over the original lender and found no evidence that LFO had assumed responsibility for those decisions. The ombudsman noted that lenders are permitted under CONC rules to consider expected future income increases when lending for education purposes.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website