Not upheld: irresponsible lending complaint against Zopa Bank Limited

Decision detail

Summary

Miss D complained that Zopa Bank Limited irresponsibly provided her with an £8,000 personal loan in 2023. Miss D argued that Zopa should have requested pay slips and bank statements, and that her overtime income should not have been included in affordability calculations. The ombudsman found that Zopa's checks were reasonable and proportionate, that income verification with a third party was acceptable, and that affordability calculations showing £861 remaining after expenses (against an estimated need of £725) supported the loan being sustainable. The ombudsman noted that Miss D's actual expenses were lower than Zopa's estimates and that credit reference agency data showed no missed payments. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Zopa's pre-lending checks were reasonable and proportionate for the loan amount. The income verification, housing cost verification via credit file, and credit reference agency checks showing no missed payments indicated Miss D was not experiencing financial difficulties. The affordability calculation showing £861 remaining after essential expenses and loan repayment (against an estimated requirement of £725) supported the conclusion that the loan was sustainable. The ombudsman considered it reasonable for Zopa to use estimated figures rather than request bank statements or pay slips given the loan size, and noted that Miss D's actual transfers to her partner (£800) were lower than Zopa's calculation (£861). There was nothing in the information gathered that should have prompted further investigation.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website