Not upheld: irresponsible lending complaint against Lendable Ltd

Decision detail

Summary

Mr L complained that Lendable irresponsibly lent him £7,500 in December 2020. Mr L argued that Lendable should not have lent to him given his existing debt levels and overdraft usage. Lendable maintained it had carried out proportionate checks including credit searches and income verification. The ombudsman found that Lendable's checks were proportionate, the credit search showed no adverse information, and the repayments were affordable. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Lendable's checks were proportionate for an early-stage lending relationship. The credit search showed no significant adverse information, and Mr L's committed non-credit expenditure did not make the repayments unaffordable. The ombudsman rejected the argument that existing debt alone should have prevented lending, noting there is no debt-to-income ratio threshold that would prohibit lending. The ombudsman also found that overdraft usage does not prohibit lending and that discretionary expenditure should not be factored into affordability assessments.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website