Facebook Credit Adverts ‘Break The Rules’
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The social networking site Facebook, which is primarily aimed at teenagers and young adults, has been criticised recently for allowing the irresponsible advertising of credit and borrowing opportunities.
Credit Action, the campaigning debt pressure group, says adverts promising cheap loans for people with poor credit ratings are appearing on the site and many break advertising regulations.
In particular, adverts are promoting two new products, payday loans secured against a salary or logbook loans secured against a car, the group says and has made a complaint to the Office of Fair Trading (OFT).
The adverts contravene British law which states that adverts for credit services must clearly state the interest rate available, which the Facebook adverts do not. Some have even claimed to be misleading.
Social networking sites, Facebook in particular, have become hugely popular in recent times. Popularity amongst general users has been matched by interest in companies wishing to use this new medium to promote their brand and generate sales. Advertising revenues have made billions for the founders of the site, although they still claim that the user experience is their first priority.
However, lots of credit companies, especially payday and logbook loans companies, are using the medium to advertise their products. It is such a popular method because they can target the young people with whom the site is so popular. Credit adverts are strictly regulated in the traditional media and so Facebook and other such sites provide a means for companies to reach audiences previously untouched.
Credit Action have released a statement saying, ‘the rules are there for a reason. They are there to make it clear to people from the beginning what they are letting themselves in for.’
The adverts come at a time when traditional lending is becoming ever more difficult and there are concerns that the adverts are designed to attract vulnerable young people who see it as an easy way of raising money quickly when in fact they are being trapped in a spiral of serious debt.
