Upheld: irresponsible lending - inadequate affordability assessment complaint against SNAP FINANCE LIMITED trading as Snap Finance
Financial Ombudsman decision DRN-6368611 of 2026-05-28T00:00:00+00:00. irresponsible lending - inadequate affordability assessment complaint against SNAP FINANCE LIMITED trading as Snap Finance. Outcome: Upheld.
Decision detail
| Reference | DRN-6368611 |
|---|---|
| Decision date | 2026-05-28T00:00:00+00:00 |
| Firm | SNAP FINANCE LIMITED trading as Snap Finance |
| Product | fixed sum loan |
| Claim type | irresponsible lending - inadequate affordability assessment |
| Outcome | Upheld |
| Remedy | Snap must: (1) calculate total repayments Miss M made and deduct from total amount received; (2) if overpaid, refund overpayment plus simple interest at Bank of England base rate plus 1% from date of overpayment to settlement; (3) if capital balance remains, arrange affordable and sustainable repayment plan; (4) once balance cleared, remove adverse information from credit file. Tax to be deducted by HMRC with certificate provided if requested. |
Summary
Miss M complained that Snap Finance irresponsibly lent her £982 for airline tickets in April 2025 without conducting adequate affordability checks. While the ombudsman found Snap's initial checks proportionate, including income verification and housing cost assessment, Snap failed to accurately use its own credit check data in affordability calculations. The credit check showed Miss M's monthly credit payments were £1,879, but Snap used only £1,414.64 in its calculations. When the correct figure is applied alongside verified housing costs (£801), essential expenses (£775.74), and the new loan repayment (£62.65), Miss M's total outgoings exceed her monthly income of £3,383, making the loan unsustainably unaffordable. The complaint was upheld and Snap was directed to refund overpayments with interest, arrange an affordable repayment plan for any remaining balance, and remove adverse credit file information once cleared.
The Ombudsman's reasoning
While Snap's initial checks were proportionate and fair, including income verification and housing cost assessment, Snap failed to accurately use its own credit check data. The credit check clearly showed Miss M's monthly credit payments were £1,879, not the £1,414.64 Snap used in calculations. When accounting for all regular payments shown on the credit check (£1,879), the new loan repayment (£62.65), housing costs (£801), and essential expenses (£775.74), Miss M's total outgoings exceeded her income of £3,383, and she would still need to make credit card repayments. Therefore, the loan was not sustainably affordable.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| SNAP FINANCE LIMITED trading as Snap Finance, all decisions | 1 | 100% |
Source
Read the original decision on the Financial Ombudsman Service website