Not upheld: account closure and default reporting without notification complaint against Vanquis Bank Limited

Decision detail

Summary

Mr V complained that Vanquis defaulted and sold his credit card account without notification. Mr V had agreed a reduced payment arrangement of £10 per month in April 2025 due to financial difficulties, and he made all agreed payments. However, because the reduced payments were below the minimum contractual amounts, arrears grew on the account. During the April call, the Vanquis agent explicitly explained that arrears would continue to grow and the account could be closed in default. After a default notice was issued on 3 July 2025, the account was closed on 1 August 2025 when arrears were not cleared, and a default was reported on Mr V's credit file. The ombudsman did not uphold the complaint, finding that Vanquis had clearly explained the consequences and acted fairly in closing the account and reporting the default.

The Ombudsman's reasoning

The ombudsman found that although Mr V never missed a payment, the payment arrangements agreed meant he was paying less than the minimum contractual amounts, causing arrears to grow. Critically, during the April 2025 call, the Vanquis agent explicitly explained that arrears would continue to accumulate and that the account could be closed with a default reported, even though Mr V was making the reduced payments as agreed. The default notice gave Mr V notice of the consequences. Therefore, Vanquis acted fairly and transparently in closing the account and reporting the default when arrears were not cleared by the deadline.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website