Miliband says Labour would ban payday lenders from targeting kids

The next Labour government will ask the Advertising Standards Authority to prevent irresponsible advertising by pay day lenders that targets or exploits children and young people – that’s the message from Ed Miliband, made in an exclusive comment piece in the Sun on Sunday.

The Labour leader accuses legal loan sharks of “using cartoon characters, trendy puppets or cute plasticine figures in some of their ads” in an attempt to use children “as a tool” to encourage their parents to take out potentially financially ruinous loans. Miliband cites a MoneySavingExpert.com survey which suggested that as many as 1 in 3 parents say their kids are repeating legal loan shark slogans and worse – that as many as 1 in 7 parents “say that when they’ve refused to buy something, children under 10 have told them to take out a pay day loan”.

Martin Lewis – the creator of MoneySavingExpert.com – has backed Labour’s plans to take such action against “the crack cocaine of lending”, describing Miliband’s proposals as “a joy”:

“We’ve been calling for a ban on payday loans on children’s TV.  The risk is they effectively groom a new generation of children, normalising, legitimising and mainstreaming this dangerous type of niche borrowing.   Our research shows 30% of parents tell us their under-10s are already repeating the slogans.  To hear the Leader of the Opposition pick up the cudgel is a joy.”

“Marketing is at the core of these loans, which cause many people pain and misery.   They’re slick, fast, efficient technological plays, the crack cocaine of lending that have created a market that didn’t really exist five years ago – and sadly our lack of regulation means they thrive here while other countries have far more effective controls.  It’s about time this change on our high street was given prominent attention in the political sphere.”

The payday lending ball is firmly in the government’s court – but will the Tories act? Or will their close links to the legal loan shark industry stop them from standing up for working people, and their children…