Ad description
A radio ad for Ocean Finance, heard on 17 January 2018, stated "Apparently there are still some people who say they don't want to apply for an Ocean credit card. That's amazing 'cause there's a credit limit of up to £1,500; texts so you keep control of your spending and you can see if you'll be accepted before you apply at [website address]. Without affecting your credit rating. But I know the real reason people say they don't want to apply - 'cause they've already got one. To apply for an Ocean credit card go to [website address]".
Issue
The complainant challenged whether the ad should have included a representative APR (RAPR).
Response
Intelligent Lending Ltd trading as Ocean Finance said they had reviewed the Financial Conduct Authority's Consumer Credit sourcebook (CONC) rules and the associated guidance and believed that the ad did not contain an RAPR trigger. They referred specifically to the guidance in CONC 3.5.8 (3) which stated “A financial promotion does not necessarily include a comparison where it merely refers to a person, product or service in a factual manner, but there will be an implied comparison for the purpose of CONC 3.5.7R (1) (b) if it may reasonably be inferred that a comparison is being made”. They also pointed to the guidance regarding incentives, which noted that the context would determine whether a statement about a product would constitute an incentive, and that to do so it must be likely to persuade or influence the customer to apply for credit or to enter into an agreement under which credit is provided, or presented in a way to have that effect.
Ocean Finance had reviewed the market and believed that the features mentioned in the ad – the credit limit, text alerts and eligibility checking facilities – were ‘normal’ offerings for a credit card and would not therefore be something that differentiated them from their competitors. They said the references to them were factual descriptions of their product and that no incentives to apply for credit or comparisons to another product, service or provider could reasonably be inferred from the ad.
Assessment
Upheld
The ASA noted that the BCAP Code stated that advertising of unsecured consumer credit must comply with the rules set out in Chapter 3 of CONC. Those rules, specifically 3.5.7 (1), required the inclusion of the RAPR in ads which indicated, in any way, that any of the terms on which credit was available was more favourable than corresponding terms applied in any other case or by any other creditors (a "comparative indication"), or that included any incentive to apply for credit or to enter into an agreement under which credit was provided.
We accepted that it was possible for information regarding credit limits, text alerts and eligibility checking facilities to be presented in a purely factual manner, and that in such circumstances it would not be necessary to include a RAPR. We also acknowledged that Ocean Finance considered those features to be comparable to those offered by many other providers in the market, such that they would not set them apart from their competitors. However, the ad began by expressing amazement that people would not already have applied for an Ocean Finance credit card and explained that was “… 'cause there's a credit limit of up to £1,500; texts so you keep control of your spending and you can see if you'll be accepted before you apply”. Those features were the primary focus of the ad and we considered there to be a clear implication that those were reasons to apply specifically for an Ocean Finance credit card, instead of cards from other providers. As such, we considered that the credit limit (which drew attention to the amount that could be borrowed) and text facility (which allowed customers to "keep control" of how they used that money) were presented as both comparative indications and incentives to apply for credit, and that the facility to check eligibility before applying was also presented as a comparative indication.
We therefore considered that the ad included incentives and comparative indications that triggered the requirement to include the RAPR.
As set out in CONC 3.5.7 (2), the RAPR, as triggered information, needed not only to be included but also to be given no less prominence than the information that triggered the requirement for its inclusion. Given that the three trigger claims were the primary focus of the ad, we considered that it would not be possible to achieve the necessary degree of prominence for the RAPR without referring to it in a manner and with a frequency which made it equally central to the message of the ad.
The ad included claims that triggered the requirement to include the RAPR, which the ad did not include. Also, because of its absence, we considered the ad did not satisfy the requirement to ensure that the RAPR was given no less prominence than the information which triggered its inclusion. Because the rules relating to the inclusion of the RAPR and its prominence had not been met, we concluded that the ad breached the Code.
The ad breached BCAP Code rule 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).
Action
The ad must not be broadcast again in its current form. We told Ocean Finance to ensure in future that ads that contained trigger claims also contained the RAPR in a way that gave it no less prominence than the trigger claims.
