ASA cracks down on payday lender advertising that 'trivialises borrowing'

Three payday loan companies have had advertisements banned after Citizens Advice complained they were irresponsible and misleading.

One ad for online lender Peachy.co.uk was printed on sandwich wrappers which claimed: "Loans from £50 to £500 … Cheaper than Payday Loans! Pay back in partial payments!" The Advertising Standards Authority said it had failed to provide evidence that customers would pay less than with other short-term lenders.

Another ad for the same firm, which showed a cartoon of a mouth next to text including the phrase, "Small bites put a smile on your lips", was banned for encouraging a casual attitude toward taking a loan.

Another ad, for broker Loan Monarch, was sent out as a text to people who applied for an unsecured loan on another website.

The ASA upheld Citizens Advice view that the message: "Hi, need a quick loan £100 up to £25,000, 98% acceptance rates! No credit checks, CCJs and defaults OK" – might encourage people who were not able to manage repayments to take out a loan.

A similar text message ad for spends4u.co.uk was banned after the regulator agreed that it implied recipients could be approved for a loan regardless of their circumstances and trivialised the lending service.

The rulings follow the ASA's ban on an ad for lender Pound to Pocket which suggested people might want to take out payday loans to pay for their birthday celebrations.

Citizens Advice's chief executive, Gillian Guy, said ads too often presented short-term loans as an easy option. "With four payday loan adverts banned within a fortnight, it is clear the payday loan industry needs to up its game when it comes to the quality of its advertising," she said. "Lenders should look again at their marketing materials to see if they are fair and responsible."