The complaints argued that small print in the ads, including the RAPR, was not sufficiently clear, and that the ads trivialised the process of taking out a loan.
Think Finance, the company behind Sunny loans, argued that their ads complied with super-imposed text guidance.
They pointed out that the words appeared for 6 seconds, when required to appear for 5.8 seconds, and text exceeded the minimum size height.
Clearcast said FCA guidance on the risk warning within the Consumer Credit Sourcebook stated, "The risk warning must be included in a financial promotion in a prominent way". They said that there was no requirement for the risk warning to be a certain height, to appear for a certain duration or to be more prominent than any other message within the ad. They said that all the on-screen text within the ad fully complied with their own guidance on super-imposed text.
Think Finance also explained that the ad sought to mock the payday loan industry by suggesting the best they could offer was dancing staff. They pointed out that there was no reference to high-cost, short-term credit for frivolous purchases, and there was no suggestion that the ads undermined the seriousness of taking out a loan.
The ASA said:
"Because we considered, within the overall presentation of the ad, the RAPR was not given greater prominence than the triggering information in the voice-over, and because we considered the ad did not ensure in any other way that the on-screen text that RAPR was more prominent, we concluded that the ad breached the Code."
However another ad was found not to breach the ASA's code because "in the context of that ad, the combination of the voice-over and on-screen text ensured the RAPR was sufficiently clear and more prominent than the comparison between the terms on which loans were offered by Sunny and other creditors."
In addition, the ASA said:
"While we understood some consumers might interpret the ad in that way, and therefore, consider that the process was quick and easy, we considered most consumers would already understand that it was possible to apply for a loan via that medium, and, therefore, were unlikely to get that impression. Because we considered the ad did not imply the female character was being negligent or reckless in her consideration of the loan, we concluded the ad was not irresponsible."
However, due to the breach of one code with regards to RAPR prominence the ASA stated that the ad "must not be broadcast again in its current form. We told Think Finance (UK) Ltd to ensure that the RAPR was presented in their ads with greater prominence than any triggering information requiring its inclusion."
During the course of the investigation, Think Finance (UK) Ltd changed their name to Elevate Credit International Ltd.
