Not upheld: irresponsible lending complaint against Zopa Bank Limited

Decision detail

Summary

Mr G complained that Zopa lent irresponsibly by failing to carry out sufficient checks and not properly considering his actual income (£28,000 not £40,000) and existing debt. He claimed the loan led to reliance on high-interest credit and caused distress. Zopa maintained their checks were proportionate and showed affordability. The ombudsman found that Zopa's checks were reasonable and proportionate, there was nothing at the time indicating the declared figures were inaccurate, and based on the information available, the borrower had approximately £1,490 remaining monthly after all commitments, making the lending fair and sustainable. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the regulatory requirement for proportionate checks considering the loan type, amount, duration and cost, and the borrower's circumstances. The checks Zopa carried out were reasonable and proportionate, showing no indicators of financial difficulty at the time. Based on the declared income and estimated housing costs, with existing credit commitments and new loan repayments, approximately £1,490 remained monthly, indicating the borrowing was likely affordable and sustainable. The ombudsman found no basis to question the accuracy of declared figures at the time of application and noted that complaints from other providers must be considered on their own merits.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website