MPs demand ban on payday loan ads during children's programmes

Loans: MP calls for curb on ads
Loans: MP calls for curb on ads

A committee of MPs has called for a ban on payday loan adverts during children's TV after a review into the activities of companies such as Wonga.

Adrian Bailey MP, the chair of the Business, Innovation and Skills committee, said children’s programmes are an unacceptable place for payday loan adverts and it is "worrying" that children are being exposed to ads that present loans as a fun, easy and appropriate way to access finance".

Bailey drew attention to recent research by Ofcom that claimed children aged from four to 15 years old viewed a total of 596 million payday loan ads last year, meaning the average child saw 70 payday loan ads in 2012.

The report from the committee believes further action is needed to protect consumers including "health warnings" on advertising, which have previously been proposed by the Financial Conduct Authority (FCA).

The committee has recommended the warnings are subject to the same requirements for prominence as Annual Percentage Rates (APRs) and the "health warning" is repeated at every stage of the application process.

Gillian Guy, chief executive of Citizens Advice, lobbied for health warnings when she was called in front of the committee.

She said: "There are no health warnings on these adverts. There is nothing about the dangers that they could present, or, indeed, that they are not the solution to all things and there might be some other way out of a debt situation, rather than more debt."

The committee has also called for the FCA and Information Commissioners Office to work together to identify the extent of mobile marketing "bad practice" within the payday loan sector.

Bailey said: "Vulnerable people at their lowest ebb should not be bombarded by texts and telephone calls offering high cost loans. But this is what anecdotal evidence suggests is happening.

"The FCA must work to build an evidence base of who is driving the market and who is being targeted. If inappropriate targeting is happening, all brokering of payday loans through email and text should be banned."

Andy Lapointe, UK public affairs manager at QuickQuid, told the committee individuals had to "opt in to receive texts from us" while Wonga asserted that it does not text people "as a way of getting business".

There should also be real-time data sharing between the payday loan firms established by July 2014 to ensure consumers can afford the payday loans and do not have multiple payday loans with different companies at one time, according to the MPs. 

Discussion

Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus
Brand Republic Jobs

subscribe now

Latest

Microsoft profits boosted by cloud computing drive
Oasis #springasmile digital campaign gets people doing good deeds
Coca-Cola: 'Don't approach bloggers with a fait accompli'
Tesco CMO Matt Atkinson: 'It is so important not to stereotype mothers'
McDonald's gives Ronald a new look ahead of global 'Fun times' social media push
In pictures: BrewDog opens first craft beer shop BottleDog for 'beer aficionados'
Facebook ad revenue leaps $1bn as it invests in targeting
Malteser or Maltesers? Mars takes Hershey trademark dispute to court
Apple Q2 profits top $10bn as iPhone sales soar
Lynx tells men not to leave love to fate
HBO captures awkwardness of watching sex scenes with parents
Primark to open first US stores with Boston chosen as flagship location
Marketing spend on the up but a reality check is needed before celebrating
Top 10 ads of the week: Jackpotjoy and BT Broadband fend off Kevin Bacon
Lidl beats Tesco to 10m Facebook fans
Center Parcs ad banned for encouraging parents to take kids out of school
Coca-Cola, Cadbury and Amazon named top brands for targeting youth market
Leaked document shows Nokia to be rebranded as Microsoft Mobile
Nike lays-off hardware staff in move that casts doubt on future of FuelBand
Greenpeace says save the bees or humans will die
What brands need to know about changes to VAT and online downloads in 2015
Jimmy Savile victims urged to claim compensation in new ad campaign
UKIP launches biggest  ad campaign and stirs up 'racist' accusations
Apple boss Tim Cook provides voiceover on ad touting firm's renewed green commitments
John Lewis walks consumers through its history to celebrate 150 years of business
Waitrose boosts content strategy with 'Weekend Kitchen with Waitrose' C4 tie-up
Hottest virals: Cute puppies star in Pedigree ad, plus Idris Elba and Fruyo
Amnesty International burns candles to illuminate new hope
Tom of Finland's 'homoerotic' drawings made into stamps
Toyota achieves the impossible by calming angry Roman drivers