Education & Family

'Parents back' payday loan TV advert ban

Payday loans sign Image copyright Reuters
Image caption Payday lending has grown considerably in recent years

Three-quarters of British parents want payday loan firms to be banned from advertising to children on TV and radio, research suggests.

A Children's Society survey of 1,065 parents suggests overwhelming support for a ban on adverts for these short-term high-interest cash advances.

A smaller survey of 680 teenagers found nine out of 10 recognised the names of payday loan firms.

Adverts are prohibited from encouraging under-18s to take out loans.

The charity's campaign follows concern that interest rates of up to 6,000% a year on such loans can plunge families into problem debt.

'Fun and tempting'

It also comes after a Commons Business Committee report warned adverts could expose children to the idea loans were "fun, easy and an appropriate way to access finance".

The Children's Society research reflects this, with a third of the young people surveyed saying they found payday loan adverts to be "fun, tempting or exciting".

The charity wants to see restrictions on loan advertising like those already in place on adverts for gambling, alcohol, tobacco and junk food.

It is calling for the government to amend the Consumer Rights Bill to ban adverts before the 21:00 watershed.

Charity chief executive Matthew Reed said: "Through our front-line work we see first hand the devastating impact of debt on children's lives.

Watershed

"We know it's become a daily battle for families to pay the bills, meet the mortgage or rent payments, and find money for food or other basics. One setback or even a simple mistake can lead to a spiral of debt.

"Right now children are being exposed to a barrage of payday loan adverts, which put even more pressure on families struggling to make ends meet and to provide the very basics for their children.

"That's why the law should be changed to ban these ads from TV and radio before the 9pm watershed."

The Advertising Standards Authority is responsible for ensuring payday loan ads, wherever they appear, are socially responsible.

Its work compliments that of the Financial Conduct Authority, which is the lead regulator for financial advertising.

The ASA said: "This arrangement means that consumers are protected by a comprehensive set of rules covering all aspects of advertising for payday loans.

"We've acted robustly against payday loan advertisers found in breach the advertising rules, banning 24 ads since April 2013."

But it pointed out that adverts - including those for payday loans - may contain elements that appeal to under-18s, such as colourful images or cartoons, without that meaning that the ad is "targeting" them, or otherwise causing them to engage with the product or service being advertised in a harmful way.

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