MPs are the latest to join the campaign to ban payday loan adverts from children's TV. A damning report from the Commons Business, Innovation and Skills Select Committee published yesterday demanded a further crackdown on irresponsible lenders to protect consumers, and particularly their children.
MP Adrian Bailey, chair of the BIS Committee, said: "It is worrying that children are being exposed to adverts that can present payday loans as a fun, easy and appropriate way to access finance. Children's programmes are not an acceptable place for the adverts."
Figures published last week revealed the number of loan advertisements seen by British kids has soared almost 20,000 per cent in four years.
While 3 million payday loan ads were seen by children in 2008, by 2012 that number had ballooned to 596 million. It means the average child saw 70 payday loan adverts last year, according to media regulator Ofcom.
Disturbingly, more than half of all payday loan ads were broadcast in the daytime in 2012 and there was more TV advertising for payday loans than for mortgages, life insurance or investments.
Mike Crockart, a Liberal Democrat MP who is a member of the BIS Select Committee, said: "We have an industry which is out of control and it needs to be dealt with urgently. Consumers are under siege from aggressive companies who are driven solely by profit."
The Select Committee also made a fresh series of recommendations for measures to control rogue lenders. They demanded that all payday loan companies should be required to resubmit their affordability tests to the FCA for approval before they can continue in the sector.
They also called for a limit of one roll-over per payday loan. Payday lenders should be required to give three working days notice before using a continuous payment authority – which allows them to clean out customers' bank accounts – and detail the right of a customer to cancel the CPA, the committee said.
"If a customer misses a repayment it is evidence that they are in financial difficulty," pointed out Mr Bailey. "It is not, as some payday loan companies seem to think, reason for offering a rollover.
"Payday loans should only be considered as a response to occasional financial shortfalls, not longer term financial difficulty."