Everyday Lending Limited · DRN-6244635

The complaint Everyday Lending Limited (ELL) provided Mr A with a loan for £4,000 over 36 months in July 2022. The monthly repayments were £260.95. Mr A says the loan was provided irresponsibly. What happened The details of this complaint are well-known to both parties, so I won’t repeat them again here. The facts aren’t in dispute, so I’ll focus on giving the reasons for my 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 unaffordable or irresponsible lending on our website, and I’ve taken this into account in deciding Mr A’s case. I’ve decided the loan wasn’t provided fairly because: • I think the checks ELL did before providing the credit were reasonable and proportionate given the loan value, the stage in the lending relationship and what it knew about Mr A’s financial situation. • Based on the information ELL gathered and what it knew about Mr A’s circumstances, I think it should have realised Mr A was likely to be unable to sustainably repay what he was being lent. • The information showed Mr A was reliant on his overdraft facility and ELL knew he did not plan to use this loan to repay any of that debt. It could see he would most likely have to rely on his overdraft to repay this loan, and make all his other monthly contractual commitments – in essence, borrowing to repay. This does not meet the regulatory requirement for loan repayments to be sustainable. • ELL disagreed with the investigator’s statement that ‘the nature of an overdraft facility is typically for short-term, emergency use’, arguing that many people use an overdraft facility in the same way they do revolving credit. But this is not aligned with regulatory guidance which sets out the expectation that overdrafts should be for short-term borrowing and occasional use. So I find it was unreasonable for ELL’s lending decision to rely on Mr A’s ongoing use of his overdraft facility. • I have not found any evidence that ELL treated Mr A unfairly in any other way. This means I don’t think ELL should have provided the loan to Mr A.

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I’ve considered whether the relationship might have been unfair under s.140A of the Consumer Credit Act 1974. However, I’m satisfied the redress I’m awarding in this case, as set out below, results in fair compensation for Mr A in the circumstances of this complaint. I’m therefore satisfied, based on what I’ve seen, that no additional award would be appropriate in this case. Putting things right As I don’t think ELL ought to have opened the account, I don’t think it’s fair for it to be able to charge any interest or charges under the loan agreement. But I think Mr A should pay back the capital amount he borrowed. Therefore, ELL should: Add up the total repayments Mr A has made and deduct these from the total amount of money Mr A received. a) If this results in Mr A having paid more than he received, any overpayments should be refunded along with 8% simple interest per year (calculated from the date the overpayments were made until the date of settlement). † ELL should also remove all adverse information regarding this account from Mr A’s credit file. b) If any capital balance remains outstanding, then ELL should arrange an affordable and suitable payment plan with Mr A. Once Mr A has cleared the balance, any adverse information in relation to the account should be removed from his credit file. † HM Revenue & Customs requires ELL to take off tax from this interest. ELL must give Mr A a certificate showing how much tax it’s taken off if he asks for one. My final decision I am upholding Mr A’s complaint. Everyday Lending Limited must put things right as set out above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr A to accept or reject my decision before 23 April 2026. Rebecca Connelley Ombudsman

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