Loans 2 Go Limited · DRN-3015314

The complaint Miss B complains that Loans 2 Go Limited irresponsibly lent to her. What happened Loans2Go lent Miss B a logbook loan in January 2013. The loan was for a £500 over 18 months with 78 weekly repayments of £14.91, Loans2Go worked out that Miss B was due to repay £64.61 every month. The total sum repayable for the loan was £1,162.98. From the information provided, Miss B repaid the loan in 2014. When Miss B complained to Loans2Go, it didn’t uphold her complaint and so she referred it to this service, one of our investigators looked at the complaint and didn’t think Loans2Go should have lent to Miss B. Loans2Go disagreed and so the complaint has been referred for an ombudsman’s decision. 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. We’ve set out our general approach to complaints about high cost lending - including all of the relevant rules, guidance and good industry practice - on our website. Loans2Go needed to take reasonable steps to ensure that it didn’t lend irresponsibly. In practice this means that it should have carried out proportionate checks to make sure Miss B could repay the loans in a sustainable manner. These checks could take into account a number of different things, such as how much was being lent, the repayment amounts and the consumer’s income and expenditure. Loans2Go has provided evidence to show that before lending this loan, it asked Miss B about her monthly income and expenses. It verified this information with her payslips and bank statements from around the time of the loan. Loans2Go said Miss B’s income was £1,437.73 and that it worked out her living costs and credit commitments to be £1,163.95 and based on that Miss B had sufficient disposable income to afford the loan. I don’t think Loans2Go did enough with the information it had about Miss B. The information from the bank statements it had showed that Miss B was in at least five active debt management plans and it looks like she was in an arrangement to repay other debts. Miss B was also repaying a rent to own provider. Loans2Go could see from its checks that Miss B was struggling to manage her credit and when she requested this loan, she said she needed the loan for cash flow problems. Loans2Go needed to do more as the bank statements Loans2Go obtained didn’t details Miss B’s full circumstances. Miss B has now provided full bank statements which I’ve had a chance to review and looking at that information Miss B wouldn’t have been left with sufficient disposable income after repaying this loan.

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Taking into account her reason for the loan and her circumstances, Loans2Go should have been aware that Miss B had wider financial problems and so beyond the pounds and pence calculation, Miss B wasn’t in a position to sustainably repay this loan when Loans2Go lent to her. Overall Loans2Go shouldn’t have lent to Miss B and it needs to put things right. Putting things right  refund all interest and charges Miss B paid on the loan;  pay interest of 8% simple a year on any refunded interest and charges from the date they were paid (if they were) to the date of settlement†;  remove any negative information about loan from Miss B’s credit file; † HM Revenue & Customs requires Loans2Go to take off tax from this interest. Loans2Go must give Miss B a certificate showing how much tax it’s taken off if he asks for one. My final decision For the reasons given above, I uphold Miss B’s complaint and require Loans 2 Go Limited to put things right as set out above. Under the rules of the Financial Ombudsman Service, I’m required to ask Miss B to accept or reject my decision before 7 March 2022. Oyetola Oduola Ombudsman

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