Christian financial advisers have welcomed a ban on adverts by a
payday loan company offering loans with a staggering APR of 278%.The ban was applied to a Pounds to Pocket advert after complaints were made to the Advertising Standards Authority (ASA).
The ASA ruled that the advert was "misleading" and "socially irresponsible", and that payday loan companies must clearly state the rates of interest being charged on loans.
Arwyn Bailey, of the Association of Christian Financial Advisers (ACFA) said: "Should a payday loan company be marketing their expensive solutions as the first port of call for those in debt, or who are finding it difficult to obtain credit? The ASA thinks not, and this is a welcome decision."
The ACFA is calling for tougher legislation against loan sharks and a cap on interest rates.
It says the interest rates charged by many payday loan companies are excessive and immoral, and that the ASA is right to insist that interest rates are prominently displayed.
ACFA spokesman Arwyn Bailey: "To offer a short-term loan at an exorbitant rate of interest to fund other debts or just to put bread on the table, is immoral. To prey upon the vulnerable in these times of economic hardship, is, in the view of ACFA, socially irresponsible.
"We all make unwise decisions in life, and we need to be accountable for those decisions. But if a company offers an apparent lifeline to a desperate individual, it is unlikely they will read the small print carefully. So the real rate of interest from these ‘easy money’ companies, should be displayed far more prominently on their adverts, in order to leave no room for doubt."