ASA Adjudication on Everyday Loans Ltd

Ad

A leaflet put through people’s doors, for Everyday Loans, featured a woman with her eyes closed, relaxing on a sofa surrounded by shopping bags. The leaflet stated "Take the strain out of your finances. Let everydayloans lighten the load. Michelle could relax with her everydayloan sorted."

Issue

The complainant objected that the leaflet was irresponsible, because it could encourage people to take out loans for the wrong reasons and get themselves into debt.

CAP Code (Edition 11)

Response

Everyday Loans said the leaflet was specifically developed for a campaign to target customers in mid-to-late January 2008, i.e. after the Christmas period.  They said the headline was used to refer to the fact that some people might have overspent on credit and store cards over the Christmas period and that a loan to consolidate those expenses might allow them to manage their finances better.  They believed the headline message was made clear by the introduction of the body copy, which stated "Whether you need to clear down your store cards after an expensive Christmas or your New Year's resolution was to simplify your finances..."  Everyday Loans said the leaflet invited recipients to review their finances at the start of the year by speaking to staff at one of their branches.. They said they did not intend the leaflet to encourage people to borrow excessively or take on unnecessary debt. They maintained that that was reinforced in the body copy with the claim "....where your finances are heading matters more to us than where they've been."  

Everyday Loans said they did not agree that using credit to finance consumer purchases might be the 'wrong reason' for taking out a loan.  They said they used the image of a woman sat among bags of shopping to show that the financial stress that may have resulted from buying gifts and other items could be alleviated by talking to them. They believed recipients would be better off making sure that their personal finances were properly organised for the year ahead. Everyday Loans said they had in place responsible lending practices, which included a stringent affordability calculation and an in-depth application process designed to ensure that customers could afford repayments.

Assessment

Upheld

The ASA noted Everyday Loans' view that the leaflet made sufficiently clear that their aim was to help people to manage their finances rather than encouraging them to take out a loan.  We noted, however, that the back of the leaflet was headlined "Personal Loans" and contained the claim "Perhaps you need some extra cash to help spread your expenses in the first few months of the year, or fancy a well earned break in the sun after a busy festive season".  We considered that readers were likely to infer that the woman depicted in the leaflet had just been on an enjoyable shopping trip funded by taking out a loan.  We considered that the reference to personal loans to fund shopping trips or holidays was likely to be seen to encourage frivolous spending on credit.  We concluded that the leaflet could encourage consumers to spend borrowed money irresponsibly.

The leaflet breached CAP Code Clause 2.2 (Responsible Advertising).

Action

We told Everyday loans not to repeat the ad and advised them to consult the CAP Copy Advice team.

Adjudication of the ASA Council (Non-broadcast)