Not upheld: irresponsible lending / inadequate affordability checks complaint against Gain Credit LLC trading as Drafty

Decision detail

Summary

Mr H complained that Drafty irresponsibly lent him £2,500 without conducting appropriate affordability checks. Drafty had verified Mr H's self-employed income (adjusted to £4,700 monthly), obtained a credit check showing no defaults, and calculated he had £1,377 disposable income monthly after accounting for his declared expenditure and existing debt payments. The ombudsman found these checks were proportionate given the loan amount and that Drafty reasonably relied on the information obtained, which indicated the facility was affordable. The ombudsman rejected Mr H's argument that more extensive checks were required, finding such checks would be disproportionate. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied CONC section 5.2A, which requires lenders to take proportionate steps to ensure consumers can repay sustainably. Given the £2,500 facility amount and hypothetical monthly repayments of £286, the ombudsman found Drafty's checks were proportionate. Drafty verified Mr H's income, adjusted it downward, considered his expenditure, and found sufficient disposable income (£1,377 per month even after accounting for revolving credit). The ombudsman rejected the argument that bank statements or full financial reviews were necessary, finding such checks would be disproportionate given the loan amount and apparent affordability. The ombudsman also found Drafty properly monitored the account and took appropriate action when Mr H defaulted in March 2026.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website