Google has announced today that it will stop showing adverts from payday loan companies to protect its users from “deceptive or harmful financial products”.
From July 13, the company will stop hosting the promotions on its AdWords platform, which allows companies to quickly create template adverts.
David Graff, Google’s director of global product policy, said that ads for payday loans where repayment was due within 60 days would no longer be allowed.
“Today we’re sharing an update that will go into effect on July 13, 2016: we’re banning ads for payday loans and some related products from our ads systems. We will no longer allow ads for loans where repayment is due within 60 days of the date of issue. In the U.S., we are also banning ads for loans with an APR of 36% or higher. When reviewing our policies, research has shown that these loans can result in unaffordable payment and high default rates for users so we will be updating our policies globally to reflect that.”
Graff continued,
“This change is designed to protect our users from deceptive or harmful financial products and will not affect companies offering loans such as Mortgages, Car Loans, Student Loans, Commercial loans, Revolving Lines of Credit (e.g. Credit Cards).”
According to Wade Henderson, president and CEO of The Leadership Conference on Civil and Human Rights,
“This new policy addresses many of the longstanding concerns shared by the entire civil rights community about predatory payday lending. These companies have long used slick advertising and aggressive marketing to trap consumers into outrageously high interest loans – often those least able to afford it.”
The ban on payday loan adverts is the latest addition to AdWords’ policy guidelines. These include sections on prohibited content, practices, restricted content and editorial standards.
Banned content includes ads for counterfeit goods; adverts for fake passports or qualifications; and adverts selling pre-written academic papers.
Despite the guidelines, millions of adverts that don’t comply make it through the system; 880 million ads were removed in 2015.
Google’s policy states,
“When we find content that violates these requirements, we may block it from appearing, and in cases of repeated or egregious violations, we may stop you from advertising with us”
The decision is the first time Google has announced a global ban on ads for a broad category of financial products. To this point, the search giant has prohibited ads for largely illicit activities such as selling guns, explosives and drugs, and limited those that are sexually explicit or graphic in nature, for example.
Facebook already bans ads on its social media site for “payday loans, paycheck advances or any other short-term loan intended to cover someone’s expenses until their next payday,†according to the company’s advertising policy.
