Not upheld: irresponsible and unaffordable lending complaint against National Westminster Bank Public Limited Company

Decision detail

Summary

Miss T complained that NatWest unfairly provided three personal loans between 2017 and 2021 that were unaffordable. The ombudsman found loan one was fairly provided following proportionate income and expenditure checks. For loans two and three, while NatWest's checks were not proportionate as they lacked information on non-discretionary expenditure, the ombudsman could not conclude unfair lending occurred because Miss T did not provide the requested bank statements needed to demonstrate what proportionate checks would have shown. The ombudsman noted Miss T's perfect repayment record and lack of evidence of financial difficulties at the time of the loans, and found no evidence NatWest should have identified concerns. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied section 140A of the Consumer Credit Act 1974 regarding unfair credit relationships. For loan one, NatWest's proportionate checks identified income, costs, and existing commitments with no adverse credit information, supporting fair lending. For loans two and three, while NatWest's checks were not proportionate as they lacked information on non-discretionary expenditure (particularly important given Miss T's prior financial difficulties and quick succession of applications), the ombudsman could not conclude unfair lending occurred because Miss T failed to provide the main bank account statements requested to demonstrate what proportionate checks would have revealed. The ombudsman noted Miss T's perfect repayment record and lack of evidence of financial difficulties at the time of loans two and three, and found no evidence NatWest should have identified concerns from information it held.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website