An average child saw 70 payday loan adverts last year

10 December 2013   By Julia Kukiewicz

IN 2012, UK 4 to 15 year olds saw 596 million adverts from payday lenders on TV, Ofcom research released today reveals.

payday loans
Credit: Sam72/

That means the average child saw 70 adverts for payday loans last year.

The Financial Conduct Authority (FCA), which will take over regulation of the payday loan sector from next year, has said that payday advertising is a major concern.

Labour have recently argued that payday lending advertising shouldn't be shown when children are likely to be watching television.

From 12 million to 7.5 billion

ofcom TV spots

Source: Ofcom Trends in Advertising Activity - Payday Loans, Dec 2013

In the past five years, the number of payday loan adverts on TV has increased from 12 million to 7.5 billion, the communications regulator found (see the full report here).

0.8% of all the TV adverts adults see, and 0.7% of all ads seen by children, are from payday lenders.

As you can see in the chart on the right, payday loan adverts are still a very small proportion of overall advertising, albeit one that's growing fast.

personal loan TV spots

In 2012, there were 34.2 million TV advertising spots, of which 0.4 million were used by payday lenders.

Even in the finance category, payday adverts make up a small minority of TV adverts.

Though, as the chart to the left shows, they pretty much dominate when it comes to advertising for personal loans.

Gambling, junk food... payday loans?

Concerns that payday loans are cluttering the schedules while children's shows are on appear to be slightly misplaced, according to Ofcom's account.

Just 3% of all payday loan adverts seen by children were seen on children's channels.

However, most payday loan adverts are shown in the daytime and early evening, when children are more likely to be watching TV, regardless of whether the programming is classed as 'for kids'.

payday TV spots by time Source: Ofcom Trends in Advertising Activity - Payday Loans, Dec 2013

As you can see in the chart above, just over half of all payday loan adverts on TV are broadcast between 9:30am and 4:59pm and that's also when adults, and children in similar proportions, are most likely to see these adverts.

These figures will likely encourage Labour's campaign to treat payday lending advertising as harmful to children, and to restrict it as we restrict adverts for gambling and junk food when children may be watching.

"As a father of two young boys, I know how influenced they can be by what they see, and I don't want payday lenders taking advantage of the cost of living crisis and targeting children in this country," the leader of the opposition, Ed Miliband said last month.

"It is wrong, it is not what should be happening and that is why a Labour Government would stop [payday lenders] advertising during children's TV," he added.

A poll carried out by Moneysavingexpert last month found that one in three parents of children under 10 had heard them repeat payday loan advertising slogans.

Advertising in the spotlight

Payday loan advertising has always been criticised almost as much as the terms of the loans themselves.

It's a signal that the loans are generally regarded as a rip off or poor value and that their existence makes consumers more vulnerable to falling into debt.

If you accept those terms, advertising payday is essentially advertising debt which is disturbing, particularly in the lighthearted manner most payday lenders adopt.

Labour have previously promised to limit payday lenders' ability to buy premises on, and especially to advertise, on high streets.

In 2010, just to take one example, London was criticised for allowing Wonga to sponsor New Year travel in London.

Since then, the lender's advertising, on TV and their sponsorship of events and football teams, has been subject to many complaints to the Advertising Standards Authority (ASA).

The groundswell of anti payday lending public opinion, driven in large part by concerns over advertising, has also led to real changes in the industry, like the recent announcement that the total cost of a loan will be capped.

However, not everyone accepts that payday loans are inherently damaging and many argue that shutting down the industry would be harmful to consumers.

An outright advertising ban looks extremely unlikely, then.

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