ASA Adjudication on Borro Ltd

Ad

A TV ad for a loan company stated “Use your valuables and you could secure a loan and raise cash in 24 hours with borro.com." A woman wearing a bracelet stated "High street pawnbrokers only offered to lend me £150 on my gold bracelet, borro.com lent me £500". A man wearing a watch stated "Most high street pawnbrokers won't take watches and the best loan offer I could find anywhere else was £600. Borro.com lent me £1300." A voice-over stated "Get a loan using your valuables and raise from £100 to £10,000 in 24 hours. Visit borro.com or call 08000 XX XXXX.” On-screen text stated “Over 18. Conditions Apply. Typical APR 85%”.

Issue

Two viewers objected that the comparison with high street pawnbrokers was misleading and unfair because consumers using borro.com would pay more than if using a high street pawnbroker.

BCAP TV Code

Response

Borro Ltd (Borro) said they had commissioned market research into high street pawnbroker chains. They said the findings showed that on average Borro lent 286% more on diamond jewellery and, for loans secured against jewellery, Borro charged 5.75% interest per month on average, compared with 9.42% per month on average for high street pawnbroker chains. They said the research also showed that 75% of high street pawnbroker chains did not lend against watches.

Borro said that if a customer borrowed £500 from Borro and £500 from a high street pawnbroker, they would pay less interest with Borro because their interest rates were on average lower. They said if a customer came to Borro with a watch or diamond jewellery they would offer to lend them more than the high street pawnbroker chain against the same item. They said they could do this because they employed experts from leading auction houses, which they believed made their valuations more accurate. They said there was no obligation on customers to take out the full loan amount offered and they could opt to borrow a lower amount if they wanted to. They said the research showed that they were giving customers fairer valuations and lending money at lower interest rates than high street pawnbrokers.

Borro said the case histories in their ads were real customers talking about their actual experiences supported by signed declarations. They said the APR for their loans was clearly shown in the ad. They believed they were not encouraging people to borrow more money than they would like to, because their records showed that their customers would be prepared to borrow more from them.

Clearcast said they concurred with the advertiser's response and did not have anything further to add.

Assessment

Not upheld

The ASA understood that Borro were prepared to lend more money on an item than many high street pawnbrokers and that, if a consumer borrowed more money on an item, the value of the interest payments would be proportionally higher than if they borrowed less. However, we considered it was for the consumer to decide whether to borrow a greater or lesser amount on an item and noted consumers were not obliged by Borro to borrow the maximum loan amount available. We also noted Borro's independent market research showed their average rate of interest per month was lower than the average rate of interest per month for high street pawnbroker chains. We concluded the ad did not mislead.

We investigated the ad under CAP (Broadcast) TV Advertising Standards Code rules 5.1.1 (Misleading advertising) and 5.4.6 (Comparative advertising) but did not find it in breach.

Action

No further action required.

Adjudication of the ASA Council (Broadcast)