Not upheld: irresponsible lending - affordability assessment complaint against MBNA Limited

Decision detail

Summary

Miss W complained that MBNA Limited irresponsibly opened two credit card accounts and increased credit limits without conducting sufficient affordability checks. MBNA opened the first card in October 2020 with a £2,500 limit (increased to £4,500 by April 2022) and a second card in December 2021 with a £2,500 limit. The ombudsman found that MBNA conducted reasonable and proportionate affordability assessments using Miss W's declared income, credit reference agency data, and estimated living costs at each stage. With no adverse payment markers or indicators of financial difficulty evident, the ombudsman concluded MBNA was not required to conduct more extensive checks and therefore did not lend irresponsibly. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that MBNA carried out reasonable and proportionate affordability assessments at each stage of lending. The firm used appropriate information including declared income, CRA data, and estimated living costs to calculate whether repayments would be sustainable. At each stage—account opening and credit limit increases—there were no adverse markers or indicators of financial difficulty that would have required further investigation. The ombudsman rejected Miss W's argument that MBNA should have reviewed bank statements, finding this was not necessary given what the credit checks showed.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website