Payday loans ads ‘grooming’ children

Martin Lewis, the founder of MoneySavingExpert.com, said one in three people with youngsters under the age of 10 reported that their children could repeat payday loan advertising slogans.

Mr Lewis told the Commons Business, Innovation and Skills Select Committee: “I think we are in danger of grooming a new generation towards this type of borrowing. And if you think we’ve got problems now you wait until 10 years’ time.

“Grooming is the right term. We’re talking about a market that didn’t exist five years ago, and you’ve had people in arguing that this is how people like to use it. They’ve created the demand, they’ve created the operational structure, and now they’re saying it’s what people want. It’s deliberately contrived and controlled.”

He said new data from MoneySavingExpert.com found 14 per cent of those surveyed reported being “nagged” by their under 10-year-olds to get a payday loan to pay for something they had refused to buy.

He told MPs: “We have normalised this. This niche lending of last resort has been normalised to a mainstream form of credit by the use of advertising.”

In a statement following his appearance before the select committee, Mr Lewis said: “The payday loan industry insists it is not targeting children, but our research shows that kids are being dazzled by catchy tunes and cute puppets.

“That’s why I’m calling on the Government and the Financial Conduct Authority (FCA) to intervene to restrict the nature of the ads and impose an outright ban from them appearing on kids’ TV.”