An advert for the payday loans company Wonga has been banned by the Advertising Standards Authority for trying to claim that the 5853% representative APR (RAPR) it charges for its loans was “irrelevant”.

The advert showed the company’s pensioner cartoon characters explaining the costs of their loans and saying:
“Some people think they will pay thousands of per cent of interest. They won’t of course – that’s just the way annual rates are calculated”.

As the characters were talking, the on-screen text described first the fixed interest rate if the loan was paid back within 18 days, then the total amount repayable, and finally the “representative 5853% APR”.

The ASA received 31 complaints over the ad spot and took issue with the way Wonga represented its interest rates and says that the company did not display the representative APR sufficiently prominently.

The ASA said:

We considered that the ad misled as to the relevance of the RAPR to a short-term loan, and because we considered it irresponsibly encouraged viewers to disregard the RAPR, we concluded that it breached the Code.


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