Gain Credit LLC · DRN-6249563

The complaint Miss A complains that Gain Credit LLC trading as “Lending Stream” irresponsibly lent to her. What happened I won’t repeat all the facts here, as those aren’t in dispute. I have reviewed the entire file and if I don’t comment on something, it isn’t because I haven’t seen it - it’s that I haven’t deemed it relevant. I mean no discourtesy by this, it’s merely to reflect the informal nature of our service. Lending Stream provided five instalment loans, as follows: Loan number Loan amount Highest monthly repayment Instalments Date taken Date repaid 1 £200 £63.56 6 6 December 2024 19 December 2024 2 £350 £110.49 6 7 December 2024 30 January 2024 3 £350 £114.09 6 1 January 2025 27 February 2025 4 £550 £190.81 6 19 February 2025 Outstanding as of Aug 2025 5 £500 £157.40 6 6 March 2025 Outstanding as of Aug 2025 I’ve summarised Miss A’s complaint as follows: • The loans provided were unaffordable as she was struggling with serious financial difficulties. • She had multiple payday loans, persistent overdrafts, six maxed-out credit cards and was relying on loans from friends and family to stay afloat. • She’d taken out a new payday loan in October 2024, shortly before this lending. • Most of her income was going towards credit repayments, leaving very little for essential living costs. • She’d missed payments on existing credit commitments and had extensive arrears. • She’d taken cash out on her credit cards. • Lending Stream lent to her in quick succession, without any meaningful break or reassessment of her financial situation. It should have carried out more thorough affordability checks. It ought to have properly reviewed her credit report and requested bank statements. • Lending Stream’s repeated lending trapped her in a cycle of high-cost debt. She was borrowing just to repay existing loans, relying heavily on overdrafts and incurring fees. • She was struggling with gambling-related issues which affected her financial decision-making and contributed to repeated borrowing to cover losses. • The situation caused her considerable stress. Lending Stream reviewed Miss A’s complaint and agreed to provide redress for loan 2, but it

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didn’t uphold Miss A’s complaint about the other loans it provided. Our Investigator considered the complaint and upheld it, as they felt loans 4 and 5 were lent irresponsibly also. Lending Stream didn’t agree and so the matter was passed to me to decide. I considered the complaint and got in touch with the parties, informally, to let them know my thoughts. I was satisfied that Lending Stream’s offer to pay redress for loan 2 went far enough and therefore I explained I wasn’t minded to uphold Miss A’s complaint about loans 1, 3, 4 and 5. Miss A didn’t agree. In summary, she said: • Her credit file didn’t show that she was managing her credit well and this ought to have prompted further checks. Rather, it showed: o She was using a high proportion of her available credit across multiple accounts. o She was making relatively low or minimum repayments on several accounts, indicating balances were persistent. o She fell behind on payments across most of her accounts during 2024 with one- or two-months arrears markers and this ought to have been an indication of financial pressure. • Lending Stream acknowledged that loan 2 was unaffordable but there was no meaningful improvement in her financial circumstances between taking out the loans. In fact, her indebtedness increased, borrowing became more frequent and loan amounts were higher. • Affordability checks were incomplete because existing credit commitments, multiple overdrafts and pre-existing arrears weren’t accounted for. • Her bank statements show her typical monthly income was around £2,700 to £2,850. Whilst she received a higher payment in January 2025, this was due to a one-off overtime payment and so not representative of her usual earnings. This means her income was overstated. • The speed, frequency and structure of this lending indicates reliance on this type of credit and shows she wasn’t able to repay sustainably without further borrowing. Early repayments were made using an overdraft and were followed by additional, larger loans. • Her bank statements provide clear evidence of financial difficulty. • She received loans from family members and continued to take out new loans while existing debts remained outstanding. I appreciate I’ve summarised Miss A’s response in far less detail than she set out – but I want to reassure her that I’ve read and considered all of the information she’s submitted, in full. As Miss A didn’t agree with my initial thoughts, I’ve carefully considered her response and have made a final decision on the matter. 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. Having done so, whilst I know this will disappoint Miss A, I’m not upholding her complaint – and I’ll explain why.

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We’ve set out our general approach to complaints about unaffordable or irresponsible lending on our website, and I’ve taken this into account when deciding Miss A’s case. Miss A was provided with high-interest loans, intended for short-term use. So Lending Stream needed to make sure that it didn’t provide them irresponsibly. I think Lending Stream’s offer to pay redress for loan 2 goes far enough. I don’t therefore think that it made a mistake when providing loans 1 and 3, 4 or 5. Before providing each loan, Lending Stream gathered information about Miss A’s income, expenditure and carried out a credit check. When carrying out its affordability calculations, it exercised caution by increasing the figures Miss A declared for her expenditure and credit commitments. It carried out open banking checks to verify her income – and I can see it appears to have taken an average of her earnings in the few months leading up to each lending decision. Miss A said she was earning less than what she declared. But given Lending Stream was able to verify the income she’d declared, I don’t think it was unreasonable for it to have relied on what she told it. Lending Stream’s credit checks also suggested Miss A was managing existing credit relatively well. I appreciate Miss A disagrees with this and she has provided a copy of her own credit report. I’ve reviewed this but Lending Stream carried out its own credit check, and it’s entitled to rely on it. That credit check may show different information compared to what Miss A can see on the credit report she’s obtained. In any event, I accept there is adverse data showing on the credit check Lending Stream carried out. But this is fairly limited, mainly historic and her accounts were up to date at the time of lending. There was one default showing, which, at the time of loan 1, had been registered 29 months earlier. No further defaults were recorded throughout this lending. As Miss A has pointed out, she did have one or two months of arrears showing on some of her active accounts, in 2024. But these had been brought up to date by the time of this lending, and she didn’t appear to be exceeding the limits on any of her accounts. The credit check did show that Miss A had taken out short-term lending before, however this appears to reduce, roughly in the year leading up to this lending. Recent short-term credit taken out was limited and had, for the most part, been paid off, seemingly without any undue difficulty before this lending. Whilst Miss A has said she was also only making the minimum repayments towards her existing credit and she was utilising her full limits, in the circumstances of this case, given what the rest of the checks showed, I don’t think this means Lending Stream shouldn’t have lent. So, whilst Miss A did have some previous adverse information showing on the credit check, it’s fair to say that this is expected in the sector of the market that Lending Stream operates in. And, as I’ve set out above, I don’t think Lending Stream’s credit checks suggest that it shouldn’t have lent to Miss A. Taking all of this into account, I’m satisfied that Lending Stream’s affordability calculations from the time of lending, suggest the loans were affordable. Bearing in mind the amount of monthly repayment, the questions Lending Stream asked Miss A, what the credit checks showed and that these were Miss A’s first loans with it, I don’t think it was unreasonable for Lending Stream to rely on the information that Miss A had provided. I know Miss A thinks Lending Stream’s checks should have gone further – for example, by checking her bank statements. Lenders aren’t obliged to check statements, and I don’t think it would have been proportionate here for Lending Stream to have done so, for the reasons explained. She also says that Lending Stream had access to open banking and therefore

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ought to have seen adverse information about her situation, evident on her statements. But using open banking doesn’t always mean a lender will have access to full statements. Here, Lending Stream has confirmed it used a service that verified Miss A’s income only – and therefore, it wouldn’t have seen any other information on her statements. I understand that our Investigator felt Lending Stream’s checks didn’t go far enough for loans 4 and 5, based on the number of loans Miss A had taken out with Lending Stream by that point. On the face of it, taking out five loans could be considered problematic. But I’m not persuaded this alone meant there was an established pattern in Miss A’s borrowing needs. I acknowledge that the loans were taken out in fairly quick succession, sometimes with two loans overlapping. Importantly, these were the first loans Lending Stream had provided to Miss A. Miss A also appears to have repaid some of the loans early and seemingly, without undue difficulty. Whilst she says she did so using an overdraft, I don’t see how Lending Stream could have reasonably known about this at that time. Moreover, Miss A was due to be indebted to Lending Stream for a total period of around nine months, across all five loans. And it’s not uncommon for individual loans to be provided over terms equivalent to the entire period Miss A was due to be indebted for. So, I don’t find that Miss A was taking out multiple loans that would mean she was indebted for a period of time, in excess of what a single loan may be provided for. Nor that having more than one loan at the same time necessarily meant that the loans were unaffordable. So, I don’t think that Lending Stream ought to have realised when providing these loans, that Miss A was using the loans in a way that was unsustainable. And I certainly don’t think the pattern of lending here, renders Lending Stream’s income and expenditure checks irrelevant - checks which were comprehensive, didn’t rely on what Miss A had declared at face value, and which showed she had plenty of disposable income, even after this new lending. The credit searches also didn’t suggest Miss A’s position was worsening and whilst her overall debt had increased over time, the individual loans appeared affordable. So, I find that Lending Stream’s checks for loans 1, 3, 4 and 5 were proportionate, and the overall lending fair. I don’t think that Lending Stream ought to have realised it was increasing Miss A’s indebtedness in a way that was unsustainable or harmful for her. Miss A says that by virtue of Lending Stream deciding that loan 2 was affordable, the other loans also ought to be deemed unaffordable. Whilst Lending Stream have chosen to uphold Miss A’s complaint about loan 2, this doesn’t automatically lead me to say that the other loans were provided irresponsibly. I appreciate Miss A has said the reality of her situation was very different, including that she was having to borrow from family and friends, and that she was gambling. I’m very sorry to hear this, it must have been a very difficult time for her. But, based on what I’ve said above, I don’t think this information would have been available to Lending Stream at the time of lending – and therefore, any harm caused by the lending, wasn’t foreseeable. I also think Lending Stream was entitled to rely on the information it had at the time, and whilst it appears now that some of that information may have been incorrect, some of it was indeed provided by Miss A. 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 Lending Stream lent irresponsibly to Miss A or otherwise treated her unfairly. I haven’t seen anything to suggest that s.140A or anything else would, given the facts of this complaint, lead to a different outcome here.

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So, I’m satisfied that Lending Stream’s offer to provide redress for loan 2 is fair and reasonable and I’m not upholding this complaint. If Miss A decides to accept Lending Stream’s offer, she can contact it directly. My final decision For all the reasons explained, I’m satisfied Lending Stream’s offer to put things right is fair and I am not upholding this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Miss A to accept or reject my decision before 22 April 2026. Sophie Kyprianou Ombudsman

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