Wonga launches new TV ad campaign, which it says won't be shown on kids' TV

It is to avoid airing the adverts during programmes that are heavily viewed by children.

MoneySavingExpert.com and its founder and editor, Martin Lewis, have long campaigned for payday loan adverts to be banned from being shown during kids' TV programmes, due to the danger of them grooming a new generation to this type of borrowing.

See the 'Payday loan ads should be banned from kids' TV' MSE News story for more on this, and see MoneySavingExpert.com's Payday Loans guide for alternatives if you're struggling.

Wonga's new ads feature characters including a dinner lady, farmer, security guard, groundsman, HGV driver and housewife selling loans with a representative 1,509% annual percentage rate.

Over the coming months, Wonga is to introduce a three-day grace period for customers who are late with repayment before it applies a £15 fee, as well as upfront information for applicants about a "worst-case scenario" should they fall into arrears.

In addition, all balances in arrears will accrue interest for a maximum of seven days, down from 30, while new customers will be able to change their mind and cancel their loan within 24 hours of approval, with no interest or fees.

'Battered by a series of scandals'

Wonga's reputation has been battered by a series of scandals that emerged as a stricter regime was imposed on the industry by regulator the Financial Conduct Authority (FCA) to prevent people being trapped in spiralling debts.

In January, payday loan customers saw the fees and interest they pay capped across the industry, and borrowers who cannot pay their debt on time will never pay back more in charges than the sum they initially wanted to borrow.

Also this year, Wonga announced plans to cut 325 jobs under a plan it says will make it smaller and less profitable but ensure that it lends "fairly and responsibly".

Last June, it was ordered to pay compensation of £2.6 million by the FCA after sending fake legal letters to 45,000 customers (see the Wonga to pay £2.6m after threatening borrowers with fake lawyers MSE News story).

Wonga chairman Andy Haste, appointed last summer, has promised to clean up the company and admitted it has made "serious mistakes".

Additional reporting by Helen Knapman.