Background
TransferWise Ltd is authorised by the Financial Conduct Authority (FCA) for the provision of payment services. As of 22 July 2016, complaints about misleading advertising for such services will be referred to the FCA for their consideration.Ad description
A website for a company that offered foreign currency transfers, included a graph that compared the "True cost of sending 10,000 GBP to EUR" between the advertisers and three competitors. Text above the graph stated "Many banks take as much as 5% of the amount you're sending. TransferWise charges just half-a-percent". The graph was headed "Real transfer fee" and showed the fee for sending £10,000 with TransferWise was £50 and to send the same amount with Moneycorp cost £182. Text below the graph stated, "Calculations based on a mid-market GBP EUR exchange rate of 1.185".
Issue
Moneycorp challenged whether the ad misleadingly implied that the "Real transfer fee" related to the transactional transfer fee only, because they understood the fee was also based on different exchange rates offered by different providers.
Response
Transferwise Ltd said that traditional providers charged two different fees on international money transfers: stated fees (transactional transfer fees), which were presented to the customer before making the transaction; and the exchange rate mark-up, which was the difference between the real mid-market exchange rate at the time of the transaction and the rate offered to the customer. They said the "Real transfer fee" was the sum total of those two fees. They explained that the "Real transfer fee" stated for Moneycorp Ltd was based on a mystery shopper exercise.
Assessment
Upheld
The ASA understood that the "Real transfer fee" did not relate to the transactional transfer fee only. Rather, it was the sum total of the transactional transfer fee and the exchange rate mark-up. In the absence of a qualification to explain how the "Real transfer fee" had been calculated, we considered that the reference to the "Real transfer fee" was ambiguous and that consumers could understand the ad to mean that the "Real transfer fee" related to the transactional transfer fee only. Because we understood the "Real transfer fee" was based on different exchange rates offered by different providers, in addition to the transactional transfer fee, and because the ad did not make that clear, we concluded that the presentation of the ad was likely to mislead.
The ad breached CAP Code (Edition 12) rules
3.1
3.1
Marketing communications must not materially mislead or be likely to do so.
and
3.3
3.3
Marketing communications must not mislead the consumer by omitting material information. They must not mislead by hiding material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner.
Material information is information that the consumer needs to make informed decisions in relation to a product. Whether the omission or presentation of material information is likely to mislead the consumer depends on the context, the medium and, if the medium of the marketing communication is constrained by time or space, the measures that the marketer takes to make that information available to the consumer by other means.
(Misleading advertising) and
3.33
3.33
Marketing communications that include a comparison with an identifiable competitor must not mislead, or be likely to mislead, the consumer about either the advertised product or the competing product.
(Comparisons).
Action
The ad must not appear again in its current form. We told Transferwise Ltd to ensure ads were not likely to mislead in future.
