Not upheld: irresponsible lending complaint against Barclays Bank UK PLC, trading as Tesco Bank

Decision detail

Summary

Ms T complained that Tesco Bank irresponsibly provided her with a £22,000 loan in 2022 requiring monthly repayments of £345 over seven years. The ombudsman found that while Tesco's pre-lending checks were not fully proportionate as they did not verify Ms T's declared income of £1,800 per month, proportionate checks would not have revealed the loan was unfair to provide. Ms T's bank statements showed her actual income was slightly higher than declared, she had minimal unsecured debt, and there was nothing to suggest she could not sustainably repay the loan. The complaint was not upheld and no remedy was ordered.

The Ombudsman's reasoning

Although Tesco's initial checks were not fully proportionate because they did not verify Ms T's income, the ombudsman concluded that proportionate checks would not have revealed the loan was unfair to provide. Ms T's actual income was slightly higher than declared, her expenditure was reasonably calculated, and there was nothing to suggest she would be unable to sustainably repay the loan. The ombudsman found no basis for upholding the complaint under general irresponsible lending principles or under section 140A of the Consumer Credit Act 1974.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website