Partially upheld: irresponsible lending complaint against Clydesdale Bank Plc trading as Virgin Money
Financial Ombudsman decision DRN-6347188 of 2026-05-26T00:00:00+00:00. irresponsible lending complaint against Clydesdale Bank Plc trading as Virgin Money. Outcome: Partially upheld.
Decision detail
| Reference | DRN-6347188 |
|---|---|
| Decision date | 2026-05-26T00:00:00+00:00 |
| Firm | Clydesdale Bank Plc trading as Virgin Money |
| Product | credit card |
| Claim type | irresponsible lending |
| Outcome | Partially upheld |
| Remedy | Virgin Money must: (1) Rework account 0817 removing all interest, fees, charges and insurances; (2) If a credit balance results, refund it to Ms H with Bank of England base rate plus 1% simple interest per year from date of overpayment; (3) Remove all adverse information regarding account 0817 from Ms H's credit file; or (4) If an outstanding balance remains, arrange an affordable repayment plan and remove adverse information once cleared. |
Summary
Ms H complained that Virgin Money lent to her irresponsibly across three credit card accounts opened between December 2020 and March 2025. The ombudsman found that proportionate checks were carried out for the initial accounts and credit limit increases, and that these checks would not have revealed concerns given Ms H's apparent income and credit management at those times. However, the ombudsman upheld the complaint regarding the third account opened in March 2025, finding that Virgin Money should have identified a developing reliance on credit and conducted fuller verification before approving this additional lending. Virgin Money was ordered to remove all interest, fees and charges from the third account and refund any credit balance with interest, or arrange an affordable repayment plan for any remaining balance.
The Ombudsman's reasoning
The ombudsman found that Virgin Money carried out proportionate checks when opening accounts 2226 and 4515, and the results gave no cause for concern. While checks should have been more thorough when increasing the credit limit on account 2226 twice, further proportionate checks (such as income verification) would likely have still resulted in approval based on Ms H's apparent salary and disposable income at those times. However, by March 2025 when account 0817 was opened, Virgin Money should have recognised a developing reliance on credit and conducted fuller verification of Ms H's overall financial position, which would have revealed the lending was inappropriate.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Clydesdale Bank Plc trading as Virgin Money, all decisions | 82 | 22% |
Source
Read the original decision on the Financial Ombudsman Service website