Background
Summary of Council decision:
Three issues were investigated, of which one was Upheld and two Not upheld.
During the course of the investigation, Think Finance (UK) Ltd changed their name to Elevate Credit International Ltd.
Ad description
Two TV ads promoted loans from Sunny:
a. One ad showed a woman walking along a road with her phone in her hand. The voice-over stated, "When surprise expenses pile up why not apply to Sunny and borrow up to £1,000?" The scene cut to a yellow screen where the text "Apply now for up to £1000" appeared. On-screen text stated "Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk". The voice-over continued, "If you're approved, you can withdraw your cash as you need it. Only Sunny offers the Sunny No Fee guarantee and the ability to choose your repayment schedule with Sunny Flexi-pay". The scene cut back to the woman on the street, who smiled and met a man walking a dog. On-screen text stated "Representative 1971% APR. Subject to status and credit assessment. T&Cs apply. 18+". The voice-over stated, "Introducing Sunny, a clear path to the cash you need, when you need it ... Good today. Better tomorrow."
b. A second ad featured a telephone conversation between a male puppet character sitting at a desk bearing the sign "PAYDAY LOANS" and a woman walking along a street. The puppet asked, "Any other questions, madam?" to which the woman responded, "Do you have Sunny flexi-pay? That thing where you pick your repayment schedule?" The puppet said "Er, no ... but we can dance!" On-screen text until this point had stated "Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk". Other puppet characters in the background started dancing to music. The scene cut to show the woman hanging up the phone as she walked along the street. In the next shot, she smiled as the screen of her phone displayed the logo for Sunny, and a voice-over stated, "Introducing Sunny, a new way to borrow up to £1,000 when you need it at representative 1971% APR variable. Find out more about Flexipay at sunny.co.uk. Good today. Better tomorrow." On-screen text at this time stated "Representative 1971% APR variable". The final scene showed text, which stated "Borrow up to £1000 today". This text changed to "Good today. Better tomorrow".
Issue
1. Four viewers challenged whether the small print in ad (a), which included the RAPR and warning message, was sufficiently clear.
2. Two viewers challenged whether the RAPR in ad (b) was sufficiently clear.
3. Three viewers challenged whether ad (b) trivialised the process of taking out a loan.
Response
1. Think Finance (UK) Ltd said ad (a) complied with the super-imposed text guidance and the spirit of that guidance. They pointed out that the words appeared for 6 seconds, when required to appear for 5.8 seconds, and text exceeded the minimum size height of 14, with the late payments warning being 18 lines high, the Representative APR (RAPR) being 24 lines high and the general legal information being 20 lines high.
Clearcast said FCA guidance on the risk warning within the Consumer Credit Sourcebook ("CONC") stated "The risk warning must be included in a financial promotion in a prominent way". They said that there was no requirement for the risk warning to be a certain height, to appear for a certain duration or to be more prominent than any other message within the ad. They said that all the on-screen text within ad (a) fully complied with their own guidance on super-imposed text.
2. Think Finance said the late payment warning was 18 lines high, the RAPR was 30 lines high and the general legal information was 18 lines high in ad (b).
Clearcast said, in ad (b), the RAPR could be seen on its own line, above the standard on-screen superimposed text and double in size.
3. Think Finance explained that the ad sought to mock the payday loan industry by suggesting the best they could offer was dancing staff. They pointed out that there was no reference to high-cost, short-term credit for frivolous purchases for nights out, expensive clothing or luxury goods/services. They explained that they ensured none of their ads was broadcast in the same break as gambling ads or between programmes that were highly indexed to children or young persons. They said they had recently held focus groups on the relevant ads and there was no suggestion that the ads undermined the seriousness of taking out a loan.
Clearcast said the dancing puppets did not reflect Think Finance, but represented other loan companies that were not designed with the consumer in mind and, therefore, only offered dancing staff. They explained that the female caller hung up because she could not pick her repayment schedule. They pointed out the ad then informed the viewer of how much someone could borrow with Sunny and the flexible repayment options, with the RAPR shown and voiced. The ad was promoting neutral and sensible borrowing options with all the information required for the viewer to make an informed and sensible decision for taking out a loan.
Assessment
1. Upheld
The ASA considered that the on-screen text contained significant information likely to be material in a viewer's decision as to whether or not to respond to the ad, including the RAPR. The BCAP Code required such information to be presented clearly, with the aim being to achieve a standard of legibility that would enable an interested viewer, who made some positive effort, to read all text. While we noted the warning message was white and shown on a yellow background, and the RAPR, and other information, was shown against a moving image, we considered that the definition between the text and the background was improved by the use of outlining on the letters, and further that the text was shown on-screen for a sufficiently long period, and was sufficiently large, that an interested viewer making some positive effort would be able to read it. We also noted Rule 3.4.1 (4) of CONC required the warning message to be included in a "prominent way". Because the warning message was included in the on-screen text, at the beginning of the ad, we considered the message was sufficiently prominent.
We noted that Rule 3.5.7 (1)(a)(ii) of CONC required credit ads to specify the RAPR if they indicated in any way that any of the terms on which credit was available was more favourable than corresponding terms used in any other case or by any other lenders. We noted the voice-over stated "Only Sunny offers the Sunny No Fee guarantee and the ability to choose your repayment schedule with Sunny Flexi-pay", which we considered implied that credit was offered by Sunny on terms more favourable than those applied by other creditors, and, therefore, that the ad triggered the requirement to include the RAPR. We noted Rule (3).5.7 (2) of CONC required that the RAPR must be given "greater prominence" than any indication or incentive outlined in Rule (3).5.7 (1), and that, in the ad, the trigger information was communicated via the scenes of the ad, while the RAPR was shown in the on-screen text. We considered that information given in a voice-over would generally be seen by consumers 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 given in the voice-over. Because we considered, within the overall presentation of the ad, the RAPR was not given greater prominence than the triggering information in the voice-over, and because we considered the ad did not ensure in any other way that the on-screen text that RAPR was more prominent, we concluded that the ad breached the Code.
The ad breached BCAP Code rules 1.3 (Compliance),
3.11
3.11
Qualifications must be presented clearly.
BCAP has published Guidance on Superimposed Text to help television broadcasters ensure compliance with rule 3.11. The guidance is available at:
http://www.cap.org.uk/~/media/Files/CAP/Help%20notes%20new/BCAP_Advertising_Guidance_Notes_1.ashx
(Qualification) 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.
(Financial products).
2. Not upheld
We considered that the on-screen text in ad (b) also contained significant information. While we noted the on-screen text, which was white, was shown on a moving shot, and the colours in the background were pale in colour, we considered that the definition and size of the text, and the duration that it was shown, was sufficient that an interested viewer making some positive effort would be able to read it.
As stated in point 1, we noted that Regulation 3.5.7 (1)(a)(ii) required credit ads to specify the RAPR if 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 lenders. The ad featured a conversation between a potential customer seeking a loan and an employee of an unnamed competitor payday loans company. The customer enquired about the availability of "Sunny Flexi-pay", which she referred to as "that thing where you pick your repayment schedule", and terminated the call when she found that the company did not offer loans on those terms. We considered that the implication of that conversation was that credit was offered by Sunny on terms more favourable than those applied by other creditors, and therefore that the ad included a comparative indication triggering the requirement to include the RAPR. We noted that, at the end of the ad, the customer was shown visiting the Sunny website on her mobile and considered that this reinforced the comparative aspect of the ad. The same rule, as that outlined at point 1 above, regarding the prominence needing to be attributed to the RAPR, as triggered information, therefore applied.
We noted that Think Finance had specified the RAPR both in the voice-over and in the on-screen text, and we considered the voice-over was spoken clearly and slowly enough for consumers to understand; for example, stating "one thousand nine hundred and seventy one", rather than "one nine seven one". Because we considered, in the context of that ad, the combination of the voice-over and on-screen text ensured the RAPR was sufficiently clear and more prominent than the comparison between the terms on which loans were offered by Sunny and other creditors, we concluded the ad did not breach the Code.
On that point, we investigated the ad under BCAP Code rules 1.3 (Compliance),
3.11
3.11
Qualifications must be presented clearly.
BCAP has published Guidance on Superimposed Text to help television broadcasters ensure compliance with rule 3.11. The guidance is available at:
http://www.cap.org.uk/~/media/Files/CAP/Help%20notes%20new/BCAP_Advertising_Guidance_Notes_1.ashx
(Qualification) 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.
(Financial products), but did not find it in breach.
3. Not upheld
While we acknowledged the complainants' concern that the ad could imply a loan was quick and simple to take out, and understood that the Sunny logo was shown on the woman's mobile phone, we noted there was no implication that the woman had not given due consideration to taking out a loan before going out or that she would use the credit to make frivolous purchases. We also noted that the woman was not shown in the process of applying for or finalising a loan and, while we understood some consumers might interpret the ad in that way, and therefore, consider that the process was quick and easy, we considered most consumers would already understand that it was possible to apply for a loan via that medium, and, therefore, were unlikely to get that impression. Because we considered the ad did not imply the female character was being negligent or reckless in her consideration of the loan, we concluded 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
Ad (a) must not be broadcast again in its current form. We told Think Finance (UK) Ltd to ensure that the RAPR was presented in their ads with greater prominence than any triggering information requiring its inclusion.
