Not upheld: Irresponsible lending complaint against Barclays Bank UK PLC trading as Barclaycard

Decision detail

Summary

Mr B complained that Barclays lent to him irresponsibly when approving a £3,500 credit card in November 2022, arguing that proper checks would have revealed he was in financial difficulties and struggling with gambling. Barclays carried out income validation, finding verified monthly income of £3,859, and CRA checks showing existing credit balances of £15,961 with all accounts up to date and no missed payments. The ombudsman found that Barclays' checks were reasonable and proportionate for the type of credit offered, and that based on the information available to them, the lending appeared affordable with Mr B having £488.18 in monthly disposable income. The ombudsman rejected arguments that Barclays should have reviewed bank statements or conducted more extensive checks, finding these would not have been proportionate. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the relevant regulatory requirements for proportionate lending checks and assessed whether Barclays' checks were appropriate for the type and amount of credit being offered. The ombudsman found that Barclays' checks were reasonable and proportionate, including income validation, CRA checks, and assessment of existing credit commitments. Based on the information available to Barclays at the time, there was no indication of financial difficulty - Mr B had a reasonable disposable income of £488.18 monthly and was managing his existing credit well with no missed payments or defaults. The ombudsman rejected the argument that Barclays should have reviewed bank statements, finding this would not have been proportionate. The ombudsman also considered the lending under Section 140A of the Consumer Credit Act 1974 and found no unfairness.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website