Not upheld: irresponsible lending complaint against Barclays Bank UK PLC (trading as Barclaycard)

Decision detail

Summary

Miss J complained that Barclaycard irresponsibly provided her with a £10,000 credit card despite her existing high debt levels. Barclaycard had obtained information on her £56,000 annual income and conducted a credit search showing no recent payment difficulties. The ombudsman found the checks were proportionate and noted the card offered 0% interest on balance transfers, allowing Miss J to consolidate approximately £7,000 of existing credit card debt and reduce interest payments. The ombudsman concluded Barclaycard was reasonably entitled to lend and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that Barclaycard's checks were proportionate for the early stage of a lending relationship. The credit card was a revolving facility, so repayment within a reasonable period (5-7 years) was the relevant standard. Miss J's declared income of £56,000 and credit history suggested she could afford repayments. Crucially, the 0% balance transfer offer meant Miss J could consolidate her existing £7,000 debt and pay less interest, improving her financial position. Even if Barclaycard should have done more checks, there was no evidence this would have led to a different lending decision. Miss J's medical circumstances were unknown to Barclaycard and could not be expected to be known at the time of lending.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website