Partially upheld: irresponsible lending and failure to address customer concerns about interest rate fairness complaint against Loans 2 Go Limited

Decision detail

Summary

Miss J complained that Loans 2 Go Limited lent to her irresponsibly by providing two loans (£1,600 in June 2023 and £2,000 in June 2024, with the second used to repay the first) that she claimed were unaffordable. She argued that proper consideration of her income and expenditure, including review of bank statements, would have revealed the loans were unaffordable. Loans 2 Go maintained it had conducted appropriate checks by verifying her income through payslips and reviewing her credit file. The ombudsman found the lender's checks were reasonable and proportionate, with no warning signs at the time of lending that the loans were unaffordable, and that subsequent financial difficulties (house move and partner's job loss) were not reasonably foreseeable. However, the ombudsman upheld the complaint in part because Loans 2 Go failed to fully address Miss J's concerns about the fairness of the interest rate, awarding £200 compensation for this failing.

The Ombudsman's reasoning

The ombudsman found that Loans 2 Go carried out reasonable and proportionate checks by verifying Miss J's income through payslips and reviewing her credit file to assess her other commitments. Based on the information available at the time of lending, Miss J appeared to have sufficient disposable income to cover the loan repayments, other costs, and unexpected expenses. The ombudsman rejected the argument that bank statements should have been reviewed, finding such checks were not proportionate given the loan amounts and the absence of warning signs in the initial checks. The ombudsman noted that Miss J's subsequent financial difficulties (house move in 2024 and partner's job loss in 2025) were not reasonably foreseeable at the time of lending. However, the ombudsman upheld the complaint in part because Loans 2 Go failed to fully address Miss J's concerns about the fairness of the interest rate.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website