The ASA steps in ten years too late

April 29th, 2009

There is a story floating around in the news at the moment about loan adverts and price comparisons being put under the microscope by the Advertising Standards Agency (ASA).

The ASA has said that social responsibility will be a key issue when looking at complaints on adverts offering credit. The watchdog also said various landmark rulings have set the standards which advertisers must adhere to.

It has ruled against firms that misled viewers or trivialised the issue of consolidating debts.

The ASA report said that the economic downturn affected the quality of advertising and the kind of appeals made to consumers.

This is all very well and I broadly support the measures, but they still make me angry. Where were the ASA and the FSA during the boom years when credit was being thrown about like water?

The attention of government, parliament, the media and pretty much everyone else is focused at the moment on the consequences of bad debt and so it seems that these measures, although useful, are little more than opportunistic band wagon jumping.

In its annual report the ASA said, “the economic downturn makes it even more important to protect consumers from being misled.” This is true, but a little more vigilance for the past ten years rather than ten minutes, could have stopped a lot of people getting into bad debt in the first place.

The ASA’s chairman has said the agency needs to be “vigilant” on behalf of the consumer. This is true, but it has not just become true in the last year. Where was the vigilance when debt ‘management’ companies were filling the advertising slots of daytime television with their phoney advice and misleading suggestions?

It must be said, however, that the action being taken is better late than never.

Adverts, including a growing number online, for financial products and price comparison websites have been among those targeted this year.

This included banning a television advert for Picture Financial Services which showed a man playing football and being filmed by his wife at the same time as applying for a loan on the telephone. The ASA Council found the advert to be misleading for implying that consolidating unsecured loans was a decision that could be taken lightly.

Others were banned for not outlining the key conditions of a loan or because they seemed to encourage irresponsible spending.

There has also been a steady rise in the number of complaints about adverts which made comparisons based on price.

The issue of adverts for loans has come up just as the Finance and Leasing Association (FLA) has said that new business for unsecured loans had dipped significantly in the first two months of 2009.
For those who have not been keeping up, an unsecured loan is a loan where the lender does not use the customer’s house as security, and the FLA said that rising unemployment and low consumer confidence had hit demand for this type of credit.

This entry was posted on Wednesday, April 29th, 2009 at 9:33 am and is filed under Personal Loans. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

The ASA steps in ten years too late

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