Google profiting from ‘predatory’ loan adverts promising instant cash

Google is profiting from ads promoting "instant" cash and loans delivered "faster than pizza" despite a pledge to ​protect users from "deceptive and harmful" financial products.

The ads were served to people in the UK who searched terms like "quick money now" and "need money help"​ and directed users to ​firms offering high-interest loans.

One, listed in Google search results above links to the government website and debt charities, promised "cash in ten minutes guaranteed" for people with "very bad credit".

The Advertising Standards Authority said last night that it was assessing​ 24 ads identified by the Observer​, paid for by 12 advertisers including loan firms and credit brokers as well as suspected scam artists.

​The regulator said many ​of the promotions w​ere likely to break ​rules on socially responsible advertising which say ads must not "trivialise" taking out loans. "A disproportionate emphasis on speed and ease of access compared to interest rates is likely to be considered problematic," its guidance says.

​Google said the ads flagged with it violated its policies and had been removed. It previously pledged to tackle "predatory" lending promotions​, banning ​ads for payday and high-interest loans in 2016.

The promotions appeared to clearly breach its policy, referring explicitly to "payday loans" and linking to websites offering​ ultra-high interest rates of up to 1721%. Many of the ads Google removed on Friday had been replaced by similar promotions within hours, some from the same advertisers flagged by the Observer.

This comes in the midst of a growing cost of living crisis, described by the Institute for Fiscal Studies as the worst financial squeeze in 60 years.​ Households are battling price rises on several fronts, including surging energy bills, grocery costs and petrol and diesel prices, compounded by disruption and supply chain issues caused by the pandemic, Brexit and the war in Ukraine.

Charities and anti-debt campaigners said such loans could trap people struggling financially, who might apply on impulse and become "trapped in a spiral".

Adam Butler, policy manager at the debt charity StepChange, said financially vulnerable people were most likely to be drawn in "due to a total lack of borrowing alternatives". "Repeated use of these kinds of products to make ends meet - often the reason people turn to this kind of borrowing - can trap people in a spiral it's very difficult to get out of," ​he said. "With the cost of living crisis set to escalate further in the coming months, there's every chance we will see a rise in the number of people forced to turn to this kind of borrowing just to get by."

Many of the promotions appeared to be targeted deliberately at people in financial trouble, with messages like "bad credit welcome". They suggested there would be little scrutiny with messages such as "no credit check" and "no call".

One ad​ said: "Instant payday loans paid in 10 minutes. Bad credit OK, credit history irrelevant." Another firm​ described available loans as suitable for "little emergencies".

Another website, Tendo Loan - one of the most prolific advertisers - claimed to be offering: "Cash in 10 minutes guaranteed. 3-36 months. No credit check!" It added: "Loan delivered faster than pizza! 2 mins to apply and 10 mins to deposit to your account. Apply 24/7." Tendo Loan did not respond to requests for comment​.

​The Financial Conduct Authority ​said​ ads suggesting loans were "guaranteed" or involved "no credit checks" were misleading. It said firms should not make claims that were "not true, such as suggesting credit is available regardless of a customer's financial circumstances or status", and that they could face enforcement action.

In some cases, ads appeared to be linked to scam websites, taking users to websites where they entered their personal details, including their bank information, phone number, date of birth and address.

Yvonne Fovargue, chair of the ​A​ll-​P​arty ​Parliamentary​ Group on ​Debt and Personal Finance, described the ads as an "online harm" and called on Google and the government to tackle them.

"It's an obvious targeting ploy for people at the end of their tether ​who, instead of taking out a loan, should be seeking debt advice​," she said.

The ASA has previously ruled against payday lenders and said it was assessing the evidence of potential breaches.

It added that while the "buck ultimately stops with the advertiser", media platforms such as Google also "bear some responsibility for ensuring content complies with the rules". "Platforms should and do take measures to ensure misleading and irresponsible ads are not published," a spokesperson said.

Google​ said: "We have strict ads policies in place regarding financial services products and prohibit ads for payday loans. We have a dedicated team working to protect users from malicious actors who try to evade detection. In 2020, we blocked or removed more than 123 million ads for violating our financial services policies."

Stella Creasy, an anti-payday loan campaigner and Labour MP for Walthamstow, described the firms offering ultrahigh interest, short-term loans as "legal loan sharks" who seek to "exploit" people's financial difficulties. "​We need the government and the regulators to constantly remain vigilant and act to stop these companies before they make a bad situation worse for so man​y," she said.