Quidie Limited · DRN-6281849

The complaint Mr S complains that Quidie Limited trading as Fernovo (“Quidie”) provided him with loans without carrying out the sufficient affordability checks. What happened A summary of Mr S’s borrowing can be found below. loan number loan amount agreement date repayment date number of monthly repayments largest monthly repayment amount 1 £250 05/07/2025 30/09/2025 4 £99.03 2 £350 30/09/2025 10/11/2025 4 £141.67 3 £400 19/12/2025 19/12/2025 4 £142.89 4 £500 19/12/2025 outstanding 4 £196.49 Quidie considered the complaint, and it outlined the checks that it carried out before it approved the loans and why it wasn’t upholding the complaint. However, as a gesture of goodwill, it said it would reduce the balance on the last loan by £55 and it would then delete all the loans from Mr S’s credit file. The complaint was considered by an Investigator who didn’t uphold it. Mr S didn’t agree with the assessment, and I’ve summarised his responses below. • Taking four loans in less than six months ought to have led to further checks being carried out. • At the time of the last loan, Mr S already had a number of outstanding payday loans as well as buy-now-pay later products. • Quidie is reporting inaccurate information about Mr S to the credit reference agency because these loans were unaffordable. • Quidie hasn’t followed industry standards and regulations when it approved these loans. • Mr S referenced a number of sections of CONC including 5.2A • Mr S said he was in a debt management plan at the time and had defaults on his credit file. • Due to the regulatory breach an unfair relationship was created. These comments didn’t change the Investigator’s mind and as no agreement has been reached, the case has been passed to me to decide. 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.

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We’ve set out our general approach to complaints about this type of lending - including all the relevant rules, guidance and good industry practice - on our website. Quidie had to assess the lending to check if Mr S could afford to pay back the amounts he’d borrowed without undue difficulty – this is set out in CONC 5.2A and I’ve considered this when thinking about Mr S’s complaint. It needed to do this in a way which was proportionate to the circumstances. Quidie’s checks could have taken into account a number of different things, such as how much was being lent, the size of the repayments, and Mr S’s income and expenditure. With this in mind, I think in the early stages of a lending relationship, less thorough checks might have been proportionate. But certain factors might suggest Quidie should have done more to establish that any lending was sustainable for Mr S. These factors include: • Mr S having a low income (reflecting that it could be more difficult to make any loan repayments to a given loan amount from a lower level of income); • The amounts to be repaid being especially high (reflecting that it could be more difficult to meet a higher repayment from a particular level of income); • Mr S having a large number of loans and/or having these loans over a long period of time (reflecting the risk that repeated refinancing may signal that the borrowing had become, or was becoming, unsustainable); • Mr S coming back for loans shortly after previous borrowing had been repaid (also suggestive of the borrowing becoming unsustainable). There may even come a point where the lending history and pattern of lending itself clearly demonstrates that the lending was unsustainable for Mr S. The Investigator didn’t consider this applied to Mr S’s complaint and I would agree given the number of loans, the amounts advanced, and the time over which Mr S borrowed. I have considered that Mr S says the pattern of borrowing was harmful – but I disagree. He took four loans in six months but one of the loans was taken and repaid on the same day – at no cost to Mr S. As such, it was reasonable for Quidie to not automatically decline Mr S’s final loan solely due to the lending history which is what Mr S has said it ought to do. Taking account of the circumstances of this complaint, I’m satisfied there is no repeat lending. Quidie was required to establish whether Mr S could sustainably repay the loans – not just whether he technically had enough money to make his repayments. Having enough money to make the repayments could of course be an indicator that Mr S was able to repay his loans sustainably. But it doesn’t automatically follow that this is the case. I’ve considered all the arguments, evidence and information provided in this context, and thought about what this means for Mr S’s complaint. Loan 1 Quidie asked Mr S for details of his income, which he declared as being £1,800 (rounded) per month. Quidie also used a report generated by a credit reference agency to gauge the accuracy of Mr S’s declaration. For this loan it increased Mr S’s income to £1,936. So Quidie didn’t just accept what Mr S provided and so for a first loan I think the income check was proportionate. But to be clear even if Quidie had relied on what Mr S had declared the loan would’ve still looked affordable. Mr S also gave details of his living costs including bills, food and credit commitments. He declared these costs came to £680 per month. Quidie then went about checking this

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information. Firstly, Quidie said it used an “affordability” report provided by a credit reference agency and that report indicated that Mr S’s credit commitments were what he declared at £400 per month. Secondly, Quidie considered the costs Mr S had declared for other living costs and housing costs. It compared the rest of Mr S’s living costs against averages provided by the Money Advice Service’s (MAS). Using MAS averages for someone in a similar situation to Mr S. For its assessment it used £661, which while more than Mr S had declared was still reasonable. Mr S didn’t declare any rent payments instead, he declared he lived at home with parent(s). As such I do think it was reasonable for Quidie to believe Mr S didn’t have any of these costs and for a first loan it was reasonable to have relied on the declaration. Taking the cost-of-living payment of £661 added to the credit commitments of £400 left a sufficient amount of disposable income for Mr S to be able to afford his Quidie repayments. I would also add that for a first loan using a combination of declarations and cross checking was sufficient, Quidie didn’t need to do any further checks. Quidie also carried out a credit search, it has provided the results it received from the credit reference agency. What Quidie couldn’t do is carry out a credit search and then not react to the information it received if necessary. And while Mr S has provided a copy of his credit report, it is reasonable for Quidie to have relied on the results it received from its own research, so I’ve not reviewed Mr S’s personal report. The headline data isn’t concerning. Mr S had one existing loan and four credit cards that had been well maintained. There was evidence that Mr S had some active ‘buy now pay later’ accounts but the sight of those alone wouldn’t be of much concern to Quidie. There was also nothing to suggest that Mr S was subject to a debt management plan. Quidie was told about 10 defaults that had been added to Mr S’s account in 2020 and 2021 and around half the defaults had been satisfied. I’ve thought about these defaults and whether it meant Quidie ought to have carried out further checks or to have declined his application. But, given the passage of time and the lack of any other recent adverse payment information it would’ve been reasonable for Quidie to believe that the defaults weren’t a reflection of Mr S’s current financial position. The defaults were in fact historic. As such the defaults alone would not have been a reason for it to consider additional checks were required. In my view, there were no signs from the credit report which would’ve indicated that Mr S was having or was likely having financial difficulties at the time. As a result, I’ve concluded the checks carried out by Quidie were proportionate before it provided loan 1 and so I do not uphold Mr S’s complaint about this loan. Loans 2 Mr S repaid loan 1 sooner than expected and then on the same day it was repaid, he returned for a slightly larger loan at £350. But given the term the amount borrowed was still modest. Quidie carried out the same sort of checks as loan 1. It asked Mr S for details of his income and expenditure. It then went about cross checking these using tools and information derived from the credit reference agencies as well as taking MAS averages into account.

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The results of this check were that Mr S’s checked income had decreased to £1,518. With a MAS payment of £513 and credit commitments of £400 he was left with a sufficient amount of disposable income to afford the repayments. But even if Quidie would’ve used the same figures from the first loan, it still would’ve calculated that he had enough disposable income to afford the repayments. As before a credit search was carried out and bearing in mind the caveats that I’ve listed above, I’ve gone on to review the credit search results. There had been no new adverse payment information, so Quidie was still aware of the existing defaults that were present at loan 1. I can see that Mr S had taken on some new buy-now-pay-later accounts.The accounts he had were being managed as expected and that wouldn’t have been enough to have prompted Quidie to carry out further checks into his finances. As such, I still don’t think it had reached the point where Quidie needed to obtain copy statements. I am therefore not upholding this loan as Quidie carried out a proportionate check which demonstrated that the loan was affordable for Mr S. As such it didn’t need to review Mr S’s declaration more closely than it did. Loan 3 Mr S applied for, and was granted the loan and then repaid it on the same day, given how quickly it was repaid Mr S may well have withdrawn from the agreement. But what I can say is based on the information Quidie has provided, Mr S wasn’t charged any interest for this loan, he borrowed £400 and repaid £400 – no financial loss has occurred. Having looked at the checks Quidie carried out for this loan – they were proportionate and showed Mr S could afford the repayments. Loan 4 On the same day that Mr S applied for and repaid loan 3, he applied for another loan, this time for £500. This was now his largest loan to date – and as it was due to be repaid over the same period as the other loans it also led to the largest monthly repayment of just under £200 per month. I have thought about whether that ought to have led to further checks being carried out but given what Mr S declared and the results of the checks Quidie did do. I’ve decided the checks it carried out where reasonable and proportionate. Quidie carried out he same checks as it had done for all other loans – which included asking Mr S about his income and outgoings and then cross checking that with the credit reference agencies and through MAS averages. As with the two previous loas, Quidie’s checks indicated that Mr S would be in a position to afford his repayments. While the disposable income calculated by Quidie may not have been entirely accurate the test that Quidie is required to do is to conduct a proportionate check based on the information it had available at the time taking account of the circumstances of the application and the loan history. And for the reasons I’ve given I’m satisfied a proportionate check was conducted before this loan was advanced. No new adverse payment information had been reported to Mr S’s credit file which Quidie received which means no new defaults or any new missed payment markers since the first loan. Indeed, by this loan, Mr S’s overall indebtedness had dropped by around £3,000 compared to the balance at loan 1.

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I can see from the report that a number of his credit card accounts had been repaid to a zero balance. There were some new buy-now-pay-later accounts, but these had been paid as expected and so, these aren’t a reason to solely uphold the complaint. The credit file wouldn’t have given Quidie any concerns that Mr S was having financial difficulties. Mr S has said by this loan Quidie ought to have been reviewing his bank statements given his financial position at the time. But there isn’t anything in the results of the checks that Quidie carried out that would’ve prompted it to research more into Mr S’s finances at the time. It therefore follows that I don’t think an error has been made by it not obtaining bank statements – I consider that would have been disproportionate. It also follows I don’t think Quidie is reporting inaccurate information to Mr S’s credit file about these loans because I think for the reasons given above, they were fairly granted. I appreciate this outcome will be disappointing to Mr S given all the submissions he’s provided. There is an outstanding balance to be paid and Quidie and if Mr S hasn’t already done so he may wish to speak to it to see what help and support it can provide moving forward. I would remind it of its obligation to treat Mr S fairly and with forbearance. Quidie did make an offer to settle the complaint in the final response letter, but it hasn’t said whether it is still available to Mr S. Mr S may wish to contact Quidie to see whether it is. 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 don’t think Quidie lent irresponsibly to Mr S 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 For the reasons I’ve outlined above, I am not upholding Mr S’s complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr S to accept or reject my decision before 26 May 2026. Robert Walker Ombudsman

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