23Dec

The months of October and November 2013 saw four payday or short-term lenders, including some of the best known names in the industry, censured by the Advertising Standards Authority (ASA).

CashEuroNet UK advertised its PoundsToPocket brand via a television advert involving an alien character. The voiceover began with the words: “Alien life forms are coming to Pounds to Pocket for help with their finances.”  The ASA found that the advert trivialised the subject of taking on debt and failed to explain why the ‘alien’ character needed the loan.

In ruling that the advert should not be broadcast again, the ASA described it as “socially irresponsible”, and commented: “We considered the use of an alien character removed the ad and the process of taking on debt from reality, which could disguise the seriousness and consequences of taking out credit.”

Later in October, Wonga was banned from broadcasting a radio advert, which included a song about the process of borrowing from Wonga, set to the tune of 1950s hit Mr. Sandman. The ASA took issue with some of the lyrics used, including: “You make it easy when the month feels too long”, which may have suggested it was appropriate to use a payday loan to supplement monthly income. They also felt the advert treated the subject of borrowing money with too much levity, by commenting: “We considered that the claim gave the impression that a high-interest short-term loan was not a financial commitment that required a great deal of consideration.”

Next to feel the force of the ASA was Cryton Ltd, which trades as urquickcash.com. The company sent text messages to people who had not consented to receiving them. According to the watchdog’s judgement, the texts also falsely implied the company held confidential financial information about the recipients. The company was banned from sending these texts again, and was ordered not to target people who had not consented to receiving marketing communications, and not to falsely imply they held data on prospective customers.

Lastly, the ASA found fault with the television adverts of Cash on Go, which trades as Peachy.co.uk. The company tried to differentiate itself from payday lenders by suggesting its loans could be repaid over several months. The advert voiceover said: “Payday loan companies expect you to repay your loan in one big payment. However, Peachy.co.uk offers multiple repayments, that’s right, multiple repayments.” According to its Facebook page, Peachy.co.uk allows loans to be repaid over periods of up to five months.

The ASA found that the advert was misleading, saying that many payday lenders now also allow repayment in instalments. It also said that the Annual Percentage Rate was not displayed sufficiently prominently. The advert cannot be broadcast again in its current form.