Fairscore Ltd · DRN-6281334

The complaint Mr T complains that Fairscore Ltd trading as Updraft irresponsibly lent to him. What happened Mr T was approved for an Updraft fixed term agreement for £4,000 in October 2024, repayable over 61 months. Mr T says that this was irresponsibly lent to him. Mr T made a complaint to Updraft, who did not uphold Mr T’s complaint. Updraft said that they believed the lending was fair and reasonable, and he could have made tangible savings as Mr T told them he was using the loan to pay off credit cards. Mr T brought his complaint to our service. Our investigator did not uphold Mr T’s complaint. He said that Updraft’s checks were proportionate, and they made a fair lending decision. Mr T asked for an ombudsman to review his complaint. He said that Updraft used open banking, but his account had so many incoming and outgoing transactions. Mr T said that in the three months prior to the Updraft account being approved, he had 56 outgoing transactions totalling £7,719, which was more than his income in that timeframe, and Updraft should have questioned this. 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. Mr T has made a number of points to this service, and I’ve considered and read everything he’s sent us. But, in line with this service’s role as a quick and informal body, I’ll be focusing on the crux of his complaint in deciding what’s fair and reasonable here. Before agreeing to approve the credit available to Mr T, Updraft needed to make proportionate checks to determine whether the credit was affordable and sustainable for him. There’s no prescribed list of checks a lender should make. But the kind of things I expect lenders to consider include - but are not limited to: the type and amount of credit, the borrower's income and credit history, the amount and frequency of repayments, as well as the consumer's personal circumstances. I’ve listed below what checks Updraft have done and whether I’m persuaded these checks were proportionate. Updraft completed Credit Reference Agency (CRA) checks, which showed there were no bankruptcies, County Court Judgement (CCJ), or Individual Voluntary Arrangement’s (IVA’s) showing on his credit file, and he had no accounts in arrears at the time of the checks. The CRA reported that Mr T had active unsecured debt of £8,078, but he had told Updraft he wanted to consolidate his credit cards, therefore I’m satisfied that the active unsecured debt wouldn’t rise by another £4,000 after the credit card balances had been consolidated. Mr T declared £29,500 of gross annual income. But Updraft didn’t just take Mr T’s word for this as they used open banking to verify his income. This was filtered just to only show his salary credits (and not any other income such as transfers between any other accounts Mr T may have). So they knew Mr T received around £1,929 net a month.

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I’ve noted Mr T’s comments about his outgoings. But Updraft didn’t use open banking for his outgoings, and as they only had one account connected to open banking, this wouldn’t show any other outgoings Mr T had with other accounts, therefore as Updraft didn’t use open banking for his outgoings, they would not have added up all of the transactions and amounts in the previous three months, as this wouldn’t have been proportionate to do so here, even if I do note the strength of feeling that Mr T has about this point. Instead, Updraft asked Mr T what his outgoings were. Mr T told Updraft he was living at home with parents, and his housing costs were £500 a month. He said his credit commitments were £333 a month, and his other expenses were £150 a month. So if Updraft would have taken Mr T’s word for his expenditure, then they would have only used £983 of outgoings a month for Mr T. But Updraft completed extra checks. They used information from a CRA regarding Mr T’s monthly credit commitments, and modelling, which is an industry standard way of assessing income. As modelling showed £519.50 for housing costs, they used this higher figure than Mr T declared, and as modelling showed his other monthly expenditure to be £669.25, instead of what Mr T declared, then they used the higher figure. Updraft used the £333 figure for his credit commitments. So I am persuaded that Zopa didn’t rely on just modelled expenditure. Mr T had the opportunity to accurately declare what his outgoings were, and when modelling suggested some of his outgoings were higher, then Updraft used higher figures, which was the responsible thing to do. The affordability assessment showed the repayments would be affordable and sustainable. It would not have been proportionate for Updraft to have made further checks based on the disposable income showing, and the lack of recent adverse information. So I’m persuaded that Updraft’s checks were proportionate and they made a fair lending decision I’ve also considered whether the relationship might have been unfair under s.140A of the Consumer Credit Act 1974. However, for the reasons I’ve already given, I can’t conclude that Updraft lent irresponsibly to Mr T or otherwise treated him unfairly in relation to this matter. I haven’t seen anything to suggest that Section 140A would, given the facts of this complaint, lead to a different outcome here. My final decision I do not uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr T to accept or reject my decision before 25 May 2026. Gregory Sloanes Ombudsman

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