We look at Vinay's complaint about the fee charged by a credit broker.
What happened
Vinay told us he was looking for a loan online. He contacted a business after seeing on its website that it could arrange loans for people with a poor credit rating. After speaking to the credit broker, they said they could find him a loan quickly. All he needed to do was provide his debit card details so they could confirm his bank account details.
Within a few days Vinay received some loan details – but these were for less than he needed and were more expensive than he’d hoped. He also saw that £250 had been taken from his bank account by the credit broker for arranging the loans.
Vinay complained to the credit broker. He explained that he didn’t want to proceed with any of the loans, and he wasn’t told about the £250 fee. The credit broker said the fee was set out in the terms and conditions on their website – so they would not be refunding the fee.
How we helped
We listened to the telephone call Vinay had with the credit broker – he was clear about what he wanted the loan for and how much he needed. There was no mention of the fee on the call, and Vinay told us he wasn’t aware that a fee would be charged.
We explained to the credit broker that because Vinay hadn’t taken out a loan, they wouldn’t be entitled to keep the full fee. But regardless of that, we didn’t think that Vinay was made aware of the fee or had agreed to pay it. After looking at Vinay’s financial situation, we thought that if he’d been told about the fee he wouldn’t have asked the credit broker to find him a loan.
Our decision
We told the credit broker to refund the full amount of the fee and pay interest from when they took the fee. We explained that Vinay had also incurred additional interest and fees from his bank because of the fee. So we asked the credit broker to refund these amounts, with interest. Finally, we thought the credit broker had caused Vinay some distress and inconvenience, so we told them to pay an additional amount to compensate for this.