Fears that payday lenders are grooming children accelerated yesterday after new figures revealed that the number of loan advertisements seen by Britain's kids has soared by almost 20,000 per cent in just four years.
The figures back up already published evidence that youngsters are being suckered by cartoon characters and juvenile jingles to believe taking out loans which charge as much as 5,000 per cent in interest per annum is perfectly normal family behaviour. Data from MoneySavingExpert showed that one in seven parents has been nagged to get a payday loan when they've refused under-10s something.
In 2008 3 million payday loan ads were seen by children aged four to 15. By 2012 that number had ballooned to 596 million. It means the average child saw 70 payday loan adverts last year, the shock new figures released yesterday by media regulator Ofcom revealed.
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. Meanwhile, the number of payday loan ads broadcast on TV has climbed from 17,000 in 2009 to 397,000 last year.
Citizens Advice chief executive Gillian Guy said: "Payday lenders are unashamedly and irresponsibly using adverts to prey on poorer households in a bid to capitalise on the cost of living crisis. Payday lenders should not be targeting children and teenagers with adverts.
"It is deeply concerning that children and teenagers were exposed to three times as many payday loan ads in 2012 compared to 2010. More and more adverts are appearing on music channels and TV stations popular with teenagers and young people as lenders try to entice the next generation of borrowers."
Citizens Advice has launched a campaign to highlight irresponsible advertising and the use of celebrity endorsements and cartoon characters in adverts.
A radio advert for Britain's biggest payday lender, Wonga, which featured a version of the popular 1950s song "Mr Sandman" was banned in October for being irresponsible. Earlier in the year the Advertising Standards Authority banned an ad by Cash Lady, featuring two-times bankrupt reality show celebrity Kerry Katona.
"The ads draw a veil over the hardships caused by payday loans," said Ms Guy. "We want TV viewers to take a stand against the payday loan industry by reporting irresponsible or misleading advertising. The FCA (Financial Conduct Authority) needs to introduce a clear and concise health warning on payday loan marketing which spells out the consequences of taking out a payday loan and to stop payday lenders targeting children with advertising."
Martin Lewis of MoneySavingExpert agrees. He said: "The Ofcom research is proof that payday lenders are grooming our children to be the next generation of borrowers. Ofcom's research should act as a clarion call for the Government to ban all high-cost credit advertising from kids' TV."
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