StepChange Debt Charity welcomes government announcements on payday loan marketing
Thursday 27th November, 2014
Following yesterday’s announcement that the government has asked the Broadcast Committee of Advertising Practice (BCAP) to broaden the remit of its review of payday loan advertising to include the appropriateness of scheduling as well as content, and that the Financial Conduct Authority (FCA) will consult on unsolicited marketing calls for payday loans, Mike O’Connor, chief executive of StepChange Debt Charity, said:
“We are extremely pleased that the government has recognised the potential harm caused to millions of people through payday loan marketing. We know that many people are drawn into a cycle of unaffordable borrowing through tempting offers that are clearly unaffordable and prevention is a welcome step forward."
Children and advertising
“Today’s families are increasingly vulnerable to falling into a cycle of damaging problem debt. Our Debt Trap report, produced in conjunction with the Children’s Society, demonstrated the devastating impact this can have on children, and showed that they are consistently being exposed at an early age to the advertising of high-risk credit. This kind of dangerous borrowing should never be allowed to be viewed as ‘the norm’ by such a young and impressionable audience.
Unsolicited marketing of payday loans
“We know that financially vulnerable people are often bombarded by offers for payday loans. There is no excuse for these firms targeting those already in difficulty who may suffer serious financial harm through taking out further loans. Protecting people from these aggressive marketing practices cannot happen soon enough and we will continue to press the FCA to ban the unsolicited real time promotion of high-risk credit products.
“The government has made a major step in recognising these issues, and we now urge the regulators to take the necessary action to ensure that consumers are protected from any further detriment caused by the inappropriate promotion of payday loans.”