DRN-6311104

The complaint Mrs H is unhappy OAKBROOK FINANCE LIMITED trading as Finio Loans provided her with five loans which were unaffordable. What happened Oakbrook provided Mrs H with five loans: • Loan one in July 2015 for £5,000. We’ve explained to Mrs H why we can’t look at her complaint about this loan and she’s accepted this. I’ve therefore not commented on this loan any further. • Loan two in February 2022 for £4,000. This was due to be repaid in 24 monthly instalments of around £303. The purpose of the loan at the time of the application was recorded as car purchase. This loan was settled early and in full with some of the proceeds from loan three in August 2023. • Loan three in August 2023 for £4,954.13. This was due to be repaid in 24 monthly instalments of around £337. This loan was settled early and in full with some of the proceeds from loan four in March 2024. • Loan four in March 2024 for £4,976.08. This was due to be repaid in 18 monthly instalments of around £405. This loan was settled early and in full with some of the proceeds from loan five in October 2024. • Loan five in October 2024 for £4,496.68. This was due to be repaid in 12 monthly instalments of around £476. The loan was completed to term. Mrs H made an irresponsible lending complaint in August 2025. She said the loan agreements weren’t affordable given her circumstances at the time. Oakbrook didn’t review Mrs H’s complaint about loan one explaining that the complaint fell outside the timeframes set by the Financial Conduct Authority (FCA). They then didn’t uphold Mrs H’s complaint about the other four loans, explaining there was no evidence to suggest that these loans were unaffordable to her. Mrs H wasn’t happy with Oakbrook’s response, so she referred her complaint to the Financial Ombudsman Service. One of our investigators looked at the complaint and said it could reasonably be considered as being about an unfair credit relationship as described in Section 140A of the Consumer Credit Act 1974 (“Section 140A”). That being so, they felt it had been referred in time and went on to consider the merits of the complaint. Having done so however, they didn’t uphold it. Mrs H D didn’t agree with the opinion of the investigator, saying that the amount and frequency of her borrowing should have been an indication to Oakbrook that there was a problem. She said that, had they requested her statements, they would’ve seen she was gambling and couldn’t afford these loans. Because an agreement couldn’t be reached, the complaint has been passed to me to decide.

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What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Having done so, I’m not upholding Mrs H’s complaint. I know this is likely to come as a disappointment to Mrs H, so I’ll explain the reasons for my decision. The Financial Conduct Authority (FCA) sets out in a part of its handbook known as (CONC) what lenders must do when deciding whether or not to lend to a consumer. In summary, a firm must consider a customer’s ability to make repayments under the agreement without having to borrow further to meet repayments or default on other obligations, and without the repayments having a significant adverse impact on the customer’s financial situation. Fundamentally, a firm must carry out checks which are proportionate to the individual circumstances of each case. I’ve kept all of this in mind when thinking about whether Oakbrook did what was needed before lending to Mrs H. Did Oakbrook carry out reasonable and proportionate checks? Before approving the loan applications, Oakbrook: • Asked Mrs H what her income was and verified this using Current Account Turnover(‘CATO’) data • Asked Mrs H about her housing costs or estimated this using statistical data • Asked Mrs H about her essential living costs or estimated this using statistical data • Estimated Mrs H’s disposable income • Checked her credit file At each application, Mrs H’s external debt was fairly low when compared to her income and she was managing her existing accounts well. Multiple defaults appeared on Mrs H’s credit file but, at the point Mrs H applied for loan two in 2022, the most recent one had been recorded 30 months prior. No further defaults were recorded in the years that followed. So, whilst this information suggested Mrs H had previously been in financial difficulty, I’m satisfied this no longer appeared to be the case by the time she applied for the loans, and all her accounts were up to date. I’m satisfied these checks were reasonable and proportionate given the credit they offered and what they knew about Mrs H’s financial situation. I appreciate Mrs H has said Oakbrook should have checked her bank statements, which would’ve alerted them that she was gambling. But for the reasons I set out above, I’m satisfied it was reasonable for Oakbrook to not review Mrs H’s statements considering the information they gathered. Did Oakbrook make fair lending decisions? Just because I think the checks were proportionate based on Mrs H’s circumstances, it doesn’t end there. I need to consider whether Oakbrook made fair decisions to lend. Loan two Oakbrook carried out a credit check which showed no recent adverse information. Mrs H had around £2,100 external debt and appeared to be managing these accounts well, with no

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missed payments, underpayments or arrears in the months leading up to the loan application. Oakbrook verified Mrs H’s monthly income of £3,060 using CATO income verification. In her application, Mrs H said she was living with parents and declared £700 monthly housing and living costs. Oakbrook increased this slightly to around £830. They relied on the CRA data to establish Mrs H’s monthly debt commitments of around £194 (which included repayments towards Mrs H’s defaulted debt). Based on these figures, and after factoring in the new loan repayment, Oakbrook estimated Mrs H would be left with around £1,730 disposable income per month. So, I’m satisfied Oakbrook didn’t act unfairly when they granted the loan to Mrs H as the information they obtained suggested that the loan would be sustainably affordable. Loan three Oakbrook’s credit check again showed no recent adverse information. It suggested Mrs H’s external debt has slightly increased to around £3,600 and she still appeared to be managing these accounts well, with no missed payments, underpayments or arrears in the months leading up to the loan application. On this occasion again, Oakbrook verified Mrs H’s monthly income of around £2,880 using CATO. They used Mrs H’s declared housing costs of £700 per month and living expenses of £1,200 per month. Finally, they relied on the CRA data to establish Mrs H’s monthly debt commitments of around £188 and added an inflation buffer of around £98. Based on these figures, and after factoring in the new loan repayment, Mrs H was left with around £357 disposable income per month. So, I’m satisfied Oakbrook didn’t act unfairly when they granted the loan to Mrs H. Loan four Once again, Oakbrook’s credit check showed no recent adverse information. Mrs H’s external debt had increased slightly again to around £7,500 but I don’t find this level of debt concerning when compared to her verified income. She still appeared to be managing these accounts well, with no missed payments, underpayments or arrears in the months leading up to the loan application. Oakbrook verified Mrs H’s monthly income of around £3,060 using CATO, used Mrs H’s declared housing costs of £700 per month and her declared living expenses figure of £800 per month. They then relied on the CRA data to establish Mrs H’s monthly debt commitments of around £373 and added an inflation buffer of around £98. Based on these figures, and after factoring in the new loan repayment, Mrs H was left with around £684 disposable income per month. So, I’m satisfied Oakbrook didn’t act unfairly when they granted the loan to Mrs H. Loan five Oakbrook carried out the same checks on this occasion again. The credit check showed no recent adverse information and Mrs H’s external debt had now reduced to around £4,200. There were no missed payments, underpayments or arrears in the months leading up to the loan application.

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Oakbrook verified Mrs H’s monthly income of £4,230 using CATO and they used Mrs H’s declared housing costs of £600 per month as well as her declared living expenses of £1,400 per month. They then relied on the CRA data to establish Mrs H’s monthly debt commitments of around £302 and added an inflation buffer of around £132. Based on these figures, and after factoring in the new loan repayment, Mrs H was left with around £1,320 disposable income per month. So, I’m satisfied Oakbrook didn’t act unfairly when they granted the loan to Mrs H. I appreciate Mrs H pointed out how much her expenditure varied at each application and I do accept that it appeared much lower when she applied for loan four. However, I’m satisfied Oakbrook’s estimated monthly disposable income was high and left a lot of leeway for Mrs H’s actual expenditure to be higher than what she’d declared. I’ve also thought about the frequency of Mrs H’s borrowing and whether this should have alerted Oakbrook that she was struggling financially. There was 17 months between loans two and three and Mrs H’s external debt had only increased by around £1,500. So, I’m not persuaded Oakbrook ought to have known Mrs H was struggling financially. And whilst there were only seven months between loans three and four and loans four and five, Mrs H was mainly using them to pay off the previous loan and only taking out an additional £1,000 on both occasions. I don’t find this concerning based on what Oakbrook knew about her income and external debt. Finally, it’s worth pointing out that the interest rates for loans three and five were lower than the previous loans, which could have been one of the reasons for Mrs H’s borrowing. Overall, having considered everything, I’m persuaded Oakbrook acted fairly and reasonably when agreeing to provide these loans to Mrs H. In reaching my conclusions, I’ve also considered whether the lending relationship between Oakbrook and Mrs H might have been unfair to Mrs H under Section 140A of the Consumer Credit Act 1974 (“Section 140A”). However, for the reasons I’ve already given, I don’t think Oakbrook lent irresponsibly to Mrs H or otherwise treated her unfairly. I haven’t seen anything to suggest that Section 140A or anything else would, given the facts of this complaint, lead to a different outcome here. My final decision For the reasons I’ve outlined above, I’m not upholding Mrs H’s complaint about OAKBROOK FINANCE LIMITED trading as Finio Loans. Under the rules of the Financial Ombudsman Service, I’m required to ask Mrs H to accept or reject my decision before 26 May 2026. Amelie Makris Ombudsman

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