Miliband Slams Payday Lenders' Kids Ads

Payday loans companies should be banned from advertising during children's TV shows, Labour leader Ed Miliband has said.

Mr Miliband used a piece in the Sun on Sunday newspaper to claim youngsters are targeted by firms keen to exploit "pester power".

Calling for them to be treated the same as gambling and junk food promotions, he said that, if the Advertising Standards Authority failed to act, a Labour government would legislate.

Accusing the companies of using "cartoon characters, trendy puppets or cute plasticine figures" to attract children, he writes: "We all know kids learn about values of family and friendship from what they watch.

Payday loan firms such as Wonga are accused of preying on children

"We also know how easily they can be influenced. That's why I really worry when payday lenders target our kids and young people.

"And that's what the evidence suggests they are doing. How else do we explain hundreds of thousands of pounds being spent by pay day lenders for adverts during children's TV programmes.

"And why else are they using cartoon characters, trendy puppets or cute plasticine figures in some of their ads?

"They aren't simply doing it to appeal directly to parents. They want to use pester power to get kids and teenagers to put pressure on their parents."

He cited a recent survey that showed more than one in three people with youngsters under 10 said their children had repeated payday loan ad slogans to them.

Father-of-two Mr Miliband is concerned about the influence of ads on kids

"The next Labour government will ask the Advertising Standards Authority to prevent irresponsible advertising by pay day lenders that targets or exploits children and young people," he said.

"This is not just about content but also the time of day when such adverts are shown. There is no justification for ever selling pay day loans during children's TV."

Martin Lewis, the founder of MoneySavingExpert.com, backed Mr Miliband's views - having previously told a Commons committee the companies' behaviour amounted to "grooming".

Bosses from the industry - which is under investigation by the Competition Commission - defended their practices when they appeared before MPs.

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.

He said Wonga's record compared favourably with the rest of the loan industry, including credit card companies and banks.

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