Google outlaws ads from payday lenders

Search giant’s global crackdown angers online lenders

Google has announced that it will ban adverts from payday lenders, in an effort to suppress the exposure of what it deems "harmful financial products".

The web services giant has banned ads offering loans where the repayment is due within 60 days or has an interest rate of 36 per cent or higher.

Advertisement - Article continues below

Google's director of global product policy, David Graff, explained that this change is intended to "protect our users from deceptive or harmful financial products".

"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," said Graff.

Payday lenders have been accused of chaining financially unstable citizens into an ongoing cycle of borrowing that gets them further into debt with interest rates that they cannot afford to repay.

A 2012 study by Pew Research found the average payday loan user in the US takes out eight payday loans a year, spending about $520 on interest and an average loan size of $375.

Google's policy change will take effect from 13 May, 2016.

In the UK, some MPs, such as Stella Creasy, have pushed for tighter government regulation of payday lenders.

Advertisement - Article continues below
Advertisement - Article continues below

Online advertising is a prominent part of payday lenders' marketing. As well as Google and other search engines, they also advertise on social media sites such as Facebook.

However, the lending industry has expressed dissatisfaction with the move.

In a public statement about Google's policy change, Lisa McGreevy, president and CEO of the Online Lender Alliance, said: "It's disappointing that a site created to help give users full access to information is making arbitrary choices on the advertisements users are allowed to see from legal businesses."

This update to Google's advertising policy will not affect companies offering other types of loans, such as mortgages, student loans, commercial loans, and credit cards.

"We'll continue to review the effectiveness of this policy, but our hope is that fewer people will be exposed to misleading or harmful products," Graff added.

Featured Resources

Top 5 challenges of migrating applications to the cloud

Explore how VMware Cloud on AWS helps to address common cloud migration challenges

Download now

3 reasons why now is the time to rethink your network

Changing requirements call for new solutions

Download now

All-flash buyer’s guide

Tips for evaluating Solid-State Arrays

Download now

Enabling enterprise machine and deep learning with intelligent storage

The power of AI can only be realised through efficient and performant delivery of data

Download now


cloud backup

Google Backup and Sync review: That syncing feeling

17 Mar 2020
Google Android

Android 11 developer access arrives earlier than expected

20 Feb 2020
data protection

Google to shift UK user data to the US post-Brexit

20 Feb 2020

Google Nest Wifi review: A solid improvement, but not for long

14 Feb 2020

Most Popular

Server & storage

HPE warns of 'critical' bug that destroys SSDs after 40,000 hours

26 Mar 2020
video conferencing

Zoom beams iOS user data to Facebook for targeted ads

27 Mar 2020

These are the companies offering free software during the coronavirus crisis

25 Mar 2020
Mobile Phones

Apple lifts iPhone purchase restrictions

23 Mar 2020