Successive British governments refused to cap super-high interest rates, which is how we allowed Wonga to charge its poor borrowers up to 5,853%. Then this week Google shocks everyone by banning adverts for payday loans above 36% APR. It tells you a lot about who really runs the world today.
The search engine giant is not banning the products itself, and they may still appear on results pages. It also looks as if the 36% may only apply to the US, but however it works this is a big blow to the pricey loan peddlers. I typed “instant loan” into Google this week, and half of the ads, taking up most of the top half of the screen, were from payday loan companies pushing loans at more than 36%: Sunny was at 979% (that will wipe the smile off anyone’s face), and UK Loans had Satsuma at 1,575%.
The credit card companies are off the hook, though. Google says “revolving lines of credit” such as credit cards are exempt from its 36% limit. In any case, when I searched for cards for people with less than perfect credit history, I found ads for Capital One’s Classic card at 34.9%, the Aqua card at 35.9%, and Marbles at 33.8%. I suspect Google has set the 36% level to make sure it still captures ad revenue from most credit card deals in the developed world.
But let’s not be churlish. This sort of move brings Google back to its former “Don’t be evil” corporate days, and is a welcome turnaround from a few years ago. In 2013 and 2014 we exposed the plague of “copycat” websites fooling people into paying over the odds for free or low-cost government services. People tapping “driving licence renewal”, “Ehic card” or even “HMRC tax” into Google were lured to sites where they were ripped off by as much as £500.
Shamefully, Google dragged its heels on the subject, and only after intense pressure from us and government bodies did it take the ads down. By banning most payday loan ads – it comes into force on 13 July – Google is likely to be taking a much bigger hit on its revenue. It may also change the marketplace, with providers incentivised to cut their rates to more sensible levels.
Google must know its brand is no longer loved, and needs to be more consumer friendly. “Financial services is an area we look at very closely because we want to protect users from deceptive or harmful financial products,” it now says, and who would argue with that?
But Google, while you’re at it, can you remove some other niggly ads as well? Type in “Ryanair” and at the top is always an annoying “Ryanair Flight on eDreams” link. Click on it and you are almost guaranteed to pay more for your flight (eg: £39.70 for a Ryanair flight to Dublin versus £25.19 on Ryanair’s own site, paying by a Visa debit card). Please get rid of it. It’s only cheaper if you have a Maltese pre-pay card (yeah, right).
That’s my Google niggle. What is yours?
We’ve had enough of the silence on TalkTalk’s data breaches
Surely it is time for the Information Commissioner’s Office to break its silence on what happened at TalkTalk last year? So far we know that there were a string of data breaches, and at least 157,000 customers had their accounts accessed. We also know a significant number of customers have been conned by fraudsters who ring up posing as TalkTalk staff. This week I took a call from yet another victim who had just lost £2,000. TalkTalk has repeatedly denied any liability, but how much longer can it keep up this position – ethically, if not legally?
This week we learned that the fall-out from the data breach contributed to TalkTalk posting profits down by half to £14m. The victims are now waiting for the ICO to rule on what really happened at the media organisation in 2015, at which point they may start their claims to be reimbursed for their considerable losses. And if TalkTalk persists in blocking their claims, then class action lawyers won’t be far behind.