Update: 27 November 2014: BCAP has today confirmed it will respond to the Government's call to review the scheduling of payday loan ads and is planning to report its findings in the new year. However it says there are no further details available at this stage.

The advertising watchdog is to investigate whether to impose a pre-watershed ban on payday loan TV and radio advertisements due to their impact on children, it was confirmed this afternoon. This is something we would fully support.

During a debate on the Consumer Rights Bill in the House of Lords this afternoon, Minister Baroness Jolly said the Broadcast Committee of Advertising Practice (BCAP) was being asked to assess how children could be better protected by considering changes to how adverts are scheduled.

BCAP is already conducting a review of payday loan advertising in general, but the Government wants it to broaden the scope to consider the appropriateness of the scheduling of advertisements to stop children being exposed to these ads.

MoneySavingExpert founder and editor-in-chief Martin Lewis has been campaigning for a pre-watershed ban on payday loan advertising, similar to that in force for gambling, alcohol, tobacco and junk food. (See The Lords mustn't miss the chance to treat payday ads like gambling or alcohol.)

He said of today's announcement: "I'm delighted the Government has recognised how important it is to stop payday lenders financially grooming the next generation of borrowers – though we will wait to see the actions behind the words.

"We need to ensure that young people are protected from these lenders just as much as they are from gambling or alcohol. The dangers of children seeing them are twofold: first, these ads pressurise parents with pester power – in our poll in October last year one in three parents reported that their under-10s had repeated payday loan slogans, and 14% shockingly said that when they had refused to buy something, their under-10 nagged them to go to a payday lender.

"Second, and perhaps even more dangerous, is that these adverts are normalising this type of niche borrowing for the next generation – inuring them to what is a hideously expensive way to borrow, and making it seem like a trivial transaction. That needs to stop."

The Children's Society has also campaigned on this issue, asking people to get in touch with peers to encourage them to support a ban on payday loan advertising before the 9pm watershed – with 16,707 people doing so.

Matthew Reed, chief executive of the Children's Society, says: "Our research shows that children are routinely being exposed to advertising that makes high-risk, high-cost loans seem fun or normal. And the majority of British parents support a pre-watershed ban.

"Children should learn about borrowing and debt from their school and family – not from irresponsible payday loan advertising which encourages families to fall into problem debt."