Not upheld: irresponsible lending complaint against Loans 2 Go Limited trading as Loans 2 Go

Decision detail

Summary

Mr M complained that Loans 2 Go lent irresponsibly when approving a £1,000 loan in April 2022, citing his multiple highly utilised credit cards, existing credit commitments, a payment arrangement, and a discrepancy between his declared and verified income. Loans 2 Go verified his income at £1,767 per month, calculated expenses at £1,327, and determined the monthly loan repayment of £205.56 was affordable with a £234 buffer remaining. The ombudsman found that Loans 2 Go's checks were reasonable and proportionate, and that although Mr M had multiple credit commitments, all were being maintained without arrears or missed payments at the time of lending. The complaint was not upheld as the ombudsman concluded the lending decision was fair based on the information reasonably available at the time.

The Ombudsman's reasoning

The ombudsman found that Loans 2 Go carried out checks that were reasonable and proportionate to the type, amount, duration and cost of the loan. The firm verified Mr M's income, used conservative figures where verification differed from declarations, considered CRA and ONS data for expenses, and found the loan was affordable with a £234 buffer remaining after repayments. Although Mr M had a payment arrangement and high credit card utilisation, the current information available did not indicate ongoing financial difficulty, as all commitments were up to date with no arrears or missed payments. The ombudsman rejected arguments that bank statements should have been reviewed or that the income discrepancy should have triggered further investigation, noting that the verified lower income still supported affordability.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website