Pay-day loan advert banned

Pay-day loan provider WageDayAdvance Ltd has been told not to repeat its television advert.

A TV ad for a pay-day loan service was viewed in February 2012, and was presented in the style of a news report. The presenter stated “In other news: Kim a teacher from Aberdeen wanted to avoid her banks unauthorised overdraft fees, so she borrowed £70 at a cost of £20.65 payable on her next pay day. Nice!” Large on-screen text stated “SHE BORROWED £70 AT A COST OF £20.65”. On-screen text at the bottom of the screen during the ad stated “£80 loan for 28 days = £23.60 charges. Total of £103.62 repayable after 28 days in a single payment. REPRESENTATIVE APR = 2814.2%.”

19 complainants, who did not believe the superimposed text was legible, objected that the ad was misleading. One complainant challenged whether the APR was sufficiently prominent in the ad.

The Advertising Standards Authority (ASA) noted that the superimposed text complied with the BCAP guidelines in terms of size and duration of hold, but also noted that the Code required advertisers to present qualifications clearly.

The complainants said they were unable to read the text, and that many described it as “squashed”. The ASA considered that the superimposed text did have a squashed appearance, and that consumers viewing that ad on TV might not be able to read it. It also noted this was in contrast to other on-screen text in the ad, such as “SHE BORROWED £70 AT A COST OF £20.65” in which the text was large and easy to read. The ASA found that the superimposed text was the only place in which the APR appeared in the ad, and considered this was information that could affect the decision of consumers to take out a loan. Because the superimposed text was not presented clearly, and contained information that could be material to a consumer’s transactional decision, The ASA concluded that the ad was misleading.

On this point the ad breached BCAP Code rules 3.1 and 3.2 (Misleading advertising) and 3.11 (Qualification).

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