Not upheld: Irresponsible lending complaint against Jaja Finance Ltd

Decision detail

Summary

Mr C complained that Jaja Finance lent to him irresponsibly by granting a credit card with a £2,600 limit and subsequently increasing it to £3,300 without performing adequate affordability checks. Mr C argued that his credit file would have shown financial instability due to undisclosed gambling issues and that proper checks would have revealed the lending was unaffordable. The ombudsman found that Jaja Finance's checks were reasonable and proportionate, the credit bureau data showed no adverse findings at the time of lending, and the affordability calculations indicated sufficient disposable income for sustainable repayments. The complaint was not upheld as the undisclosed gambling issues could not have been identified by the lender and the lending decision was fair based on the information available to Jaja Finance.

The Ombudsman's reasoning

The ombudsman found that Jaja Finance's checks were reasonable and proportionate for the level of lending involved. The credit bureau data showed no adverse findings that would have triggered more intrusive checks. The use of Office of National Statistics data modelling for expenses was reasonable given the small amount of credit offered and the absence of obvious financial difficulties in the credit file. The undisclosed gambling issues, while significant, could not have formed part of Jaja Finance's decision-making as they were neither disclosed nor visible on the credit file. The affordability calculations indicated sufficient disposable income for sustainable repayments.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website