Not upheld: irresponsible lending and unfair credit decisions complaint against Clydesdale Bank Plc trading as Virgin Money

Decision detail

Summary

Miss C complained that Virgin Money irresponsibly lent to her by issuing two credit cards and increasing the first card's limit, despite signs of financial difficulty and vulnerability related to gambling issues. She sought refunds of interest and charges, account reconstruction, and credit file correction. The FOS investigator upheld the complaint regarding the second card, but the ombudsman disagreed. The ombudsman found that Virgin Money's affordability checks were proportionate and fair based on information available at the time, showing sufficient disposable income and satisfactory account conduct. Although Miss C later experienced financial difficulties and vulnerability, these were not apparent to Virgin Money until her November 2025 complaint. The complaint was not upheld, though the ombudsman reminded Virgin Money of forbearance obligations going forward.

The Ombudsman's reasoning

The ombudsman applied the FCA's Consumer Credit Sourcebook (CONC) requirements for proportionate affordability assessments. For each lending decision, Virgin Money obtained information about Miss C's income, expenditure and existing credit commitments. The checks showed sufficient disposable income to support the lending. The balance transfers at 0% promotional rates were intended to reduce overall indebtedness. Account conduct was satisfactory with no signs of financial difficulty visible in the CRA data. Late payments in 2019 were exceptions to an otherwise consistent payment pattern occurring nearly four years before the second card approval. Virgin Money could not reasonably have identified Miss C as vulnerable without information about her gambling or health issues, which were only disclosed in the November 2025 complaint.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website