Google announced Wednesday that it will remove so-called “payday” advertisements from its Google AdWords network beginning June 13.
“We will no longer allow ads for loans where repayment is due within 60 days of the date of issue,” Google’s director of global product policy David Graff said in a blog post. “In the U.S., we are also banning ads for loans with an APR of 36% or higher. When reviewing our policies, research has shown that these loans can result in unaffordable payment and high default rates for users so we will be updating our policies globally to reflect that.”
Google’s new policy basically means that it isn’t going to advertise for companies that will loan money to you at unreasonable interest rates (the money you need to pay back for getting the loan in the first place) or in a quick period. They’re often called “payday” loans because folks short of cash before payday will take out a loan to cover an expense with the assumption they’ll pay it back soon – when their paycheck comes in. The problem is that these sorts of loans are often viewed as being rather exploitative given that they often target folks who are “those least able to afford it,” according to president and CEO of The Leadership Conference on Civil and Human Rights Wade Henderson.
“This change is designed to protect our users from deceptive or harmful financial products and will not affect companies offering loans such as Mortgages, Car Loans, Student Loans, Commercial loans, Revolving Lines of Credit (e.g. Credit Cards),” Graff explained.
This should be welcomed by most folks, though a single comment on Google’s blog post, appearing to be from one such advertiser, suggests that even self-proclaimed “responsible advertisers” are being hurt by the new but “selective” changes.
John Oliver recently tackled these loan business in an episode of “Last Week Tonight.”