A controversial payday loan company has received 63 complaints for one of their recent television adverts, and has had the complaints upheld by the Advertising Standards Agency (ASA), who found that it was misleading and did not comply with the Consumer Credit (Advertisements).
Viewers complained that the ‘light hearted presentation’ of the ad was likely to mislead vulnerable consumers about the nature and implications of taking out a pay day loan.
Accompanied to cheerful background music, the ad showed a man who spoke as two different characters, having a conversation with himself. One half needed to borrow £70 immediately to tide him over until next Tuesday, at one point he says, “Of course, I could ask my bank…” as laughter plays in the background.
The other half plays the part of payday lender, Wonga, who says, “I can help, just visit my website.”
The man says: “Bet this is going to cost me an arm and a leg”, to which his alter-ego answers: “No, you can keep those sir. Seventy pounds for five days will cost you £9.22. Two clicks at Wonga.com will tell you all you need to know.”
Meanwhile text on screen stated: “£70 for 5 days = £9.22. Total repayable £79.22. Typical 2689% APR.”
Wonga responded to the complaints, saying that they said they took their branding and consumers perception of their service “very seriously” and had never received a complaint that a customer did not understand their pricing or terms.
The payday lender said that the average consumer was “not vulnerable” as many cash advances were done online and therefore customers would have “the mental ability to transact online” to obtain a loan from them.
Wonga also said the laughter in the ad was intended to “create a connection with those viewers who had found banks and their charges less than helpful or transparent”, and was only heard for “approximately two seconds”.
Although the payday lender said that it did not believe the ad was misleading, they said they were willing to amend it for future use.
However, the ASA found that the ad did not comply with Consumer Credit regulations as the size of the on-screen text that provided details of the APR was not large enough.
In the adjudication, the ASA stated: “The tone of the ad, which included light hearted background music, colourful imagery, laughter related to the concept of obtaining a loan from a bank, a seemingly casual conversation and a character that wore a split costume and had half a beard gave the general impression that the service offered was a trivial one that could be considered in a light hearted manner.
“We considered the ad did trivialise the nature of the service offered and gave a misleading impression to those who were likely to qualify for it, which could include vulnerable viewers who had money problems.”
The advertising watchdog ruled that the ad must not be shown again in its current form.
The ASA concluded: “We told Wonga to ensure their future marketing material was presented in such a way that it was not likely to mislead about the nature and implications of the product. We also told them to ensure their advertising complied with the relevant regulations.”
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