Payday loan lenders critised for targeting children through advertising

05 December 2013 - Which Way To Pay

    



Miliband calls for payday loan adverts to be banned on children's TV

Mr Miliband has recently critised payday loan lenders who "target" children through advertising. He said that Labour government would urge the advertising watchdog to introduce a ban. Failing that, Miliband would introduce legislation. Mr Miliband told the BBC payday lenders were spending hundreds of thousands of pounds advertising during children's TV programmes.

Payday lenders spending hundreds of thousands of pounds advertising during children's TV

Mr Miliband said "I think it's wrong, it's not what should be happening and that's why a Labour government would stop them advertising during children's TV, because it's bad for young people, it's bad for families and it's bad for communities." He continued "just wrong" that payday loans were "putting pressure on our kids to pester their parents".

Payday lenders putting pressure on parents

Mr Miliband and his views are supported by Martin Lewis. Who said a survey of parents suggested that 30% of children under 10 are repeating advertising slogans from payday loans companies. "We've been calling for a ban on payday loans on children's TV," he said. "The risk is they effectively groom a new generation of children, normalising, legitimising and mainstreaming this dangerous type of niche borrowing."

The vast majority of people pay us back on time

Henry Raine, head of regulatory and public affairs at Wonga, told the committee: "Wonga's business is aiming to lend to people who can pay us back, that's how we make money.

"The vast majority of people pay us back on time. We freeze interest after 60 days and 25% of people pay us back early."

Mr Raine said around 3% of loans, equating to around 40,000 of Wonga's 1.25 million customers, go to the 60-day period.

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