Background
Summary of Council decision:
Two issues were investigated, of which one was Upheld and one was Not upheld.
Ad description
Two TV ads for a payday loan provider, Pounds to Pocket, featured a group of advertising executives discussing ideas for a new campaign.
a. In the first ad, one of the executives stated, "Right people, we need ideas for the new Pounds to Pocket TV campaign. What have we got?" to which another executive replied, "What kind of loans do they do again?" Another executive said, "Personal loans, repaid over a period that's affordable for you" and another said, "So, the ad could be about finding the right loan. We could have an explorer that ..." The first executive said, "Too far-fetched." Another executive stated "What about a lighthouse that lights the way through financial emergencies?" and another stated "What about a talking parrot? Pounds to Pocket, Pounds to Pocket. It's good for repetition". The first executive said "Guys, please". Writing on a board behind the executives stated "Up to £2000 6-12 months".
The voice-over said, "If Pounds to Pocket wrote adverts, they'd be as straightforward as our loans. Find out more at poundstopocket.co.uk." On-screen text during the ad stated "Representative 399% APR. Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk" and "All loans subject to status, affordability and credit checks. T&Cs apply. Over 18s only".
b. In the second ad, one of the executives stated, "So, we still haven't found the right idea for the new Pounds to Pocket TV ad. Look, we know that they lend up to £2000." Another executive stated, "Ooh, could be a song. Two thousand, two thousand ..." The first executive replied, "No, thank you, Gordon Bennett" and asked another "What about you?", to which he replied "Well, they're called Pounds to Pocket, have we considered a talking pocket?" and the first executive said, "Give me strength." Writing on a board behind the executives stated "Up to £2000 6-12 months".
The voice-over said, "If Pounds to Pocket wrote adverts, they'd be as straightforward as our loans. Find out more at poundstopocket.co.uk. Representative 399% APR." On-screen text during the ad stated "Representative 399% APR. Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk" and "All loans subject to status, affordability and credit checks. T&Cs apply. Over 18s only".
Issue
The ASA challenged whether:
1. the representative APR (RAPR) in ad (a) was given adequate prominence; and
2. the RAPR in ad (b) was given adequate prominence.
Response
Pounds to Pocket provided quantitative data that measured how long the RAPR and other information had featured in the ads.
Clearcast said they were mindful of RAPR prominence requirements, and had therefore asked Pounds to Pocket's senior counsel to provide an assurance and reasons why they believed the ad was compliant with the relevant regulations. They provided copies of this assurance for both ads.
Assessment
1. Upheld
The ASA noted that the Consumer Credit sourcebook (CONC) 3.5.7R (1) set out a number of conditions under which a credit ad needed to specify the RAPR. These included: if the ad indicated in any way that the way in which the credit was offered was more favourable (either for a limited period or generally) than corresponding ways used in any other case or by any other lenders or if it contained an incentive (in the form of a statement about the speed or ease of processing, considering or granting an application, or of making funds available) to apply for credit or to enter into an agreement under which credit was provided.
We considered whether the ad contained any incentives that would trigger the requirement to include the RAPR. We noted that the voice-over at the end of the ad included the statement "... as straightforward as our loans" and considered that this would be interpreted as a clear statement about the ease of obtaining credit with Pounds to Pocket, and therefore constituted an incentive to apply for credit with them.
We also considered whether the claim "If Pounds to Pocket wrote adverts, they'd be as straightforward as our loans" constituted a comparative claim that suggested the way that credit was offered by Pounds to Pocket was more favourable than other lenders, and therefore triggered the requirement to include the RAPR. We noted that the claim was made in the context of a meeting of advertising executives discussing ideas for an ad campaign for Pounds to Pocket loans. We considered that, given that the claim was made as the executives were trying to establish what made Pounds to Pocket unique and different, which implied that Pounds to Pocket's loans were notably and distinctly straightforward, it included a comparative element.
For the above reasons, we concluded that the requirement to include the RAPR had been triggered.
As set out in CONC 3.5.7R (2), the RAPR, as triggered information, should have been given more prominence than the information that triggered the requirement for its inclusion. We noted that the trigger claim "If Pounds to Pocket wrote adverts, they'd be as straightforward as our loans" was included in the voice-over, whereas the triggered information (the RAPR) featured three times in bold text at the bottom of the screen, with accompanying text beneath. While we acknowledged that including the RAPR several times in bold text made it reasonably prominent within the ad, we also considered that information communicated verbally to viewers would generally be seen as being more prominent than on-screen text at the bottom of the screen, and that on-screen text at the bottom of the screen was therefore unlikely to be sufficiently prominent if the triggering information was verbally stated. We noted that each ad should be viewed as a whole, but considered that the triggering information was likely to draw the viewer's attention more than the RAPR and the RAPR was therefore insufficiently prominent. On that basis, we concluded that the ad breached the Code.
On this point, the ad breached BCAP Code rules 1.3 1.3 Advertisements must comply with the law and broadcasters must make that a condition of acceptance. (Compliance) and 14.11 14.11 The advertising of unsecured consumer credit or hire services by consumer credit businesses or consumer hire businesses and / or credit brokering businesses or related credit services, such as debt counselling or debt adjusting is acceptable only if the advertiser complies with the financial promotions requirements imposed by FSMA and the FCA's rules set out in Chapter 3 of CONC.. The requirements for financial promotions set out in Chapter 3 of CONC do not apply: (a) where the credit is available only to a company or other body corporate (such as a limited liability partnership); (b) where a financial promotion is solely promoting credit agreements or consumer hire agreements or P2P lending agreements for the purposes of a customer's business; (c) to a financial promotion to the extent that it relates to qualifying credit or (d) it falls within the definition of an excluded communication as set out in the FCA's handbook. If the applicability or interpretation of these rules or provisions is in doubt, advertisers may contact the FCA. The FCA does not check financial promotions for compliance with the CONC rules before they are published. Such advertisements that involve distance marketing must also comply with the Financial Services (Distance Marketing) Regulations 2004 (as amended). Other distance-marketing financial advertisements are covered by the FCA Handbook. (Lending and credit).
2. Not upheld
We noted that, like ad (a), the voice-over in ad (b) included the statement "If Pounds to Pocket wrote adverts, they'd be as straightforward as our loans" in the same context, which, for the same reasons, triggered the requirement to include the RAPR. The RAPR therefore should have been given more prominence than the information that triggered the requirement for its inclusion.
Again, the trigger "If Pounds to Pocket wrote adverts, they'd be as straightforward as our loans" was included in the voice-over. The RAPR featured twice in bold text at the bottom of the screen, with accompanying text beneath, meaning that it was present on-screen for most of the ad. The RAPR was also stated in the voice-over. As both the triggering information and the triggered RAPR were communicated verbally to viewers, and the triggered RAPR was also communicated by on-screen text, we considered that the RAPR was likely to draw the viewer's attention more than the trigger. Because we considered that when taken as a whole, the RAPR was more prominent in the ad than the information that triggered its inclusion, we concluded that the ad did not breach the Code.
On this point, we considered the ad under BCAP Code rules 1.3 1.3 Advertisements must comply with the law and broadcasters must make that a condition of acceptance. (Compliance) and 14.11 14.11 The advertising of unsecured consumer credit or hire services by consumer credit businesses or consumer hire businesses and / or credit brokering businesses or related credit services, such as debt counselling or debt adjusting is acceptable only if the advertiser complies with the financial promotions requirements imposed by FSMA and the FCA's rules set out in Chapter 3 of CONC.. The requirements for financial promotions set out in Chapter 3 of CONC do not apply: (a) where the credit is available only to a company or other body corporate (such as a limited liability partnership); (b) where a financial promotion is solely promoting credit agreements or consumer hire agreements or P2P lending agreements for the purposes of a customer's business; (c) to a financial promotion to the extent that it relates to qualifying credit or (d) it falls within the definition of an excluded communication as set out in the FCA's handbook. If the applicability or interpretation of these rules or provisions is in doubt, advertisers may contact the FCA. The FCA does not check financial promotions for compliance with the CONC rules before they are published. Such advertisements that involve distance marketing must also comply with the Financial Services (Distance Marketing) Regulations 2004 (as amended). Other distance-marketing financial advertisements are covered by the FCA Handbook. (Lending and credit), but did not find it in breach.
Action
Ad (a) must not be broadcast again in its current form. We told Pounds to Pocket that where the inclusion of the RAPR was triggered in future ads, the RAPR needed to be given more prominence than the information that triggered the requirement for its inclusion.
