Google Inc. recently released a statement indicating that it would ban advertisements for ‘Payday loans’ from their platform and their AdWords program. The new policy comes into effect on July 13th this year, so if you have an AdWords account and are in the business of credit and loans, ensure you understand how the changes might affect your business, and amend your ads before the changes take place.

Director of Global Product Policy, David Graff, released the statement in May 2016 citing consumer protection from ‘fake or harmful’ products and misleading representations as the reason for the changes. In particular, the new policy clamps down on fraudulent, dishonest or misleading advertisements in the area of financial services and credit providers, where bad business and shonky marketing practices jeopardise the economic livelihood and well-being of individuals.

Google AdWords Policy

If you run or intend to run a Google AdWords campaign, it’s important to familiarise yourself with their policies. Among others, Google’s AdWords Policy contains provisions prohibiting a broad range of ‘bad ads’ from their system. In the recent statement, Graff boasted that the company had disabled over 780 million ads in 2015 for non-compliance with it’s policies.

Examples of ads and content banned or restricted by Google’s AdWords Policy include:

  • Counterfeit (fake) goods;
  • Inappropriate content, including hateful or violent messages, harassment, racial, sexual or religious intolerance;
  • Offensive, Sexual or Adult-oriented content;
  • Alcoholic beverages, Cigarettes and other harmful products;
  • Gambling-related content;
  • Healthcare-related content; and
  • Financial Services, which we will discuss in more detail below.

Why Restrict Ads About Financial Services?

The sensitive nature of financial services and the significant personal risks associated with them require appropriate regulation so as to minimise possible harm for consumers. Scams and fraudulent practices in the financial services industry are particularly rife online and Google, a trusted source, has a responsibility to protect users from this type of behaviour.

According to Google’s AdWords Policy, all advertisers advertising products and services related to financial services must do the following:

  • Comply with the local laws in their country, state or other jurisdiction;
  • Disclose all fees associated with the financial product or service;
  • Appropriately acknowledge accreditation/endorsement and disclose any affiliations, such as those that improve the reputation of the site (e.g. government affiliation and or ratings given by reputable third-parties); and
  • Provide legitimate physical contact information to enable users to contact the business.

What Is a PayDay Loan and What Ads Will Google Ban Under the New Policy?

Google will ban ads for loans where:

  • The repayment period is less than 60 days from the date the loan has been issued; and
  • The advertised APR (Annual Percentage Rate) or interest rate is 36% or higher (in the U.S.).

Despite indicating that the percentage figure only represented the policy in the U.S., Google also stated it would implement the policy globally, to protect all it’s users from unsafe loans that would lead to “unaffordable payment and high default rates”.

The prohibition does not seek to ban all advertisements of companies offering credit and loan services. Essentially, more established and common forms of lending are exempt from the ban, such as:

  • Mortgages
  • Student Loans
  • Loans for businesses and companies; or
  • Services that assist with paying off debts and resolving lines of credit (e.g. outstanding credit card debts).

What To Do If Your AdWords Program is Suspended

Google AdWords reserves the right to suspend an AdWords account without reason or warning, if a user does not comply with their policy. Under the new ban on Payday and PPC loans, many businesses that engage in this might find themselves suspended from the service. If this does happen to you and you believe that your ads do not contravene Google’s policy, you can draft a letter appealing the action to the Google Policy Team, or their Legal Department.

Key Takeaways

With their official corporate motto as “don’t be evil”, it’s unsurprising that Google prioritises consumer protection. If you provide financial services that include payday loans, and you run a Google AdWords campaign, ensure that you are familiar with the changes to their policy and amend your campaign and content accordingly. If you have any questions, or if you have had your ads suspended and would like to appeal the decision, get in touch with our advertising and consumer lawyers on 1300 544 755.

Lachlan McKnight
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