Not upheld: Irresponsible lending complaint against Vanquis Bank Limited

Decision detail

Summary

Mr G complained that Vanquis irresponsibly provided him with a £500 credit card in September 2022 when the credit was unaffordable given his existing debt levels and subsequent entry into a debt management plan in March 2023. Vanquis conducted credit reference agency checks, relied on Mr G's declared income of £28,000 and calculated he had sufficient disposable income to afford the card, with no recorded defaults or arrears. The ombudsman found that Vanquis's checks were reasonable and proportionate for the modest credit limit, showed no indicators of financial difficulty, and that the subsequent DMP did not retrospectively prove the credit was unaffordable at the time of issuance. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Vanquis conducted reasonable and proportionate borrower-focused checks appropriate to the modest £500 credit limit. The checks showed Mr G had declared sufficient income to afford the card, existing credit was being serviced without recorded issues, and there were no indicators of financial difficulties that would have warranted further investigation. The subsequent entry into a DMP did not retrospectively demonstrate the credit was unaffordable at the time of issuance, and Vanquis could not reasonably have been aware of Mr G's mental health issues when issuing the card.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website