Background
Summary of Council decision:
Three issues were investigated, all of which were Not upheld.
Ad description
A TV ad promoting Satsuma Loans featured a satsuma singing the following lyrics from the song “Alone” by Heart: "Till now I always got by on my own, I never really cared until I met you, and now it chills me to the bone, how do I get you alone, how do I get you alone". The subsequent voice-over stated, "To get a loan for up to £300 you can pay back in weekly segments, apply today at satsumaloans.co.uk" whilst consecutive shots showed graphics stating "Borrow up to £300", "weekly segments" and "satsumaloans.co.uk". At the end of ad, on-screen text stated "18+ T&C's apply. Loans subject to an affordability assessment. Satsuma Loans is a trading name of Provident Personal Credit Ltd".
Issue
Two complainants challenged whether the ad was misleading because:
1. it did not state an APR; and
2. it did not include a representative example.
3. Another complainant challenged whether the ad was irresponsible because it trivialised the nature of the product advertised.
Response
1. & 2. Provident Personal Credit Ltd t/a Satsuma Loans said the ad was specifically designed, in compliance with the Consumer Credit (Advertising) Regulations 2010 (the Regulations), to avoid the requirements for a representative APR (RAPR) or a representative example. They highlighted that, in accordance with Regulation 6(1)(b), the ad did not need to specify a RAPR because it did not include any incentive to apply for credit. They referred to guidance issued by the Office of Fair Trading (OFT) and said it made clear that an incentive would include benefits such as reward points, cash back or discounted interest rates, and highlighted that the ad included no such trigger.
They explained that the ad deliberately only included factual content, namely that Satsuma Loans was a credit provider, that it offered loans up to the value of £300, that those loans were repayable in weekly instalments, that before any credit was issued the customer was subject to an affordability assessment and, finally, that Satsuma loans were subject to further terms and conditions which were detailed on their website, to which potential customers were directed.
They explained that they were not a payday lender and did not promise to deliver a loan within a set timescale and therefore the ad did not refer to the potential motivations that a consumer might have for applying for credit, or to the fact that the loan would be received in a particular time frame. Similarly, they stated that the style of the voice-over was designed to be downbeat and conservative in tone, and simply presented the information in a straightforward and direct manner. They highlighted that nothing in the ad gave the impression that it was quick or easy to obtain a loan.
Satsuma Loans also stated that, in accordance with Regulation 4(1), the ad did not include any reference to a rate of interest or an amount relating to the cost of the credit, and that the only reference to credit was the amount that a consumer could apply for. They believed that the amount of credit available did not fall into the Regulations' definition of "cost of the credit" and therefore the ad did not need to include a representative example.
Finally, Satsuma Loans stated that both the voice-over and on-screen text directed potential customers to the Satsuma Loans website where full details of the terms of the loan including a representative example containing a RAPR were available.
Clearcast said, when clearing the ad, they had an assurance from the advertiser that it was compliant with the Regulations. They also explained that in light of previous ASA adjudications they had worked with the advertiser and suggested amendments to ensure the ad only included factual information and no claims that could be understood as an incentive. Therefore they were of the view that there was no requirement for the ad to include a RAPR or a representative example.
3. Satsuma Loans explained that the ad had been created to launch the brand and the content designed to capture viewers' attention with memorable animation and music. They said they had featured an animated satsuma as they believed it was the most memorable visual representation of both the brand name and the linked concept of payments by manageable weekly instalments or "segments". They did not believe that the use of animation or the style of music used gave the impression that the decision of whether to take out a loan was one to be taken lightly. They also highlighted that the ad deliberately only contained factual information and avoided any references to consumers seeking credit in response to a particular need, and did not emphasise the speed by which a consumer could access a loan. They therefore believed that the ad did not trivialise the nature of the product or the decision to apply for a loan.
Clearcast acknowledged that the ad had a playful element and that viewers of a certain age would recognise it to be a homage to the song "Alone" by Heart with a play on the words "alone/ a loan". They said for those who did not recognise the homage, the lyrics and visual elements were nothing more than an audio and visual description of Satsuma Loans and the service they provided. In either case, they did not believe that the treatment trivialised the nature of the product being advertised and merely described it.
Assessment
1. & 2. Not upheld
The ASA understood that, under Regulation 6(1)(a), credit ads must specify a RAPR if they indicated that credit was available to those who might otherwise believe their access to credit was restricted, or they 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. Similarly, we understood Regulation 6(1)(b) required credits ads to include a RAPR if they included any incentive to apply for credit or to enter into an agreement under which credit was provided. In both instances, we understood that if a RAPR was required it should be given greater prominence than the incentive. Regulation 4(1) also required credit ads that included a rate of interest or an amount relating to the cost of credit to include a representative example.
We considered that the requirement for an RAPR was not triggered by the claim "in nice weekly segments", and that the content of the ad did not trigger the need for a representative example. Therefore, we considered that the ad was compliant with the Regulations and concluded that it was not misleading.
On that point, we investigated the ad under BCAP Code rule 1.3 1.3 Advertisements must comply with the law and broadcasters must make that a condition of acceptance. (Responsible advertising) 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.
3. Not upheld
We noted Satsuma Loans' comments that the ad only included factual information and simply alerted consumers to the existence of the advertiser and the service they provided. We understood that Satsuma Loans had chosen to include the animated satsuma singing the song "Alone" to ensure the ad, and its key message regarding weekly repayments, stood out to viewers.
We considered that the use of an animated singing satsuma and the parody of the song "Alone", which was shown for the majority of the ad, gave it a light-hearted and humorous tone. We considered, however, that the use of humour in the ad, in itself, was unlikely to give viewers the impression that taking out a loan was a decision to be taken lightly. We noted that the ad included limited information relating to Satsuma Loans. but did not include any reference to, or condone, a consumer's motivations for taking out a loan, the speed by which credit could be accessed, or encourage consumers to use their service on a regular basis. Therefore, we considered that the content of the ad, including the animated satsuma, was unlikely to change a viewer's understanding of the service offered, or encourage them to seek a loan without properly considering the implications of doing so. We therefore considered that the use of humour did not trivialise the process of taking out a loan, and concluded that the ad was not irresponsible.
On that point, we investigated the ad under BCAP Code rule 1.2 1.2 Advertisements must be prepared with a sense of responsibility to the audience and to society. (Responsible advertising), but did not find it in breach.
Action
No further action necessary.
