Payday loan ads are no longer welcome on Google.
The website said Wednesday that it had banned ads for these “fraudulent or harmful financial products” because they “can lead to unaffordable payments and high failure rates for users”.
The global policy change for the AdWords program begins July 13th opinion from Google (. )
“We will no longer allow ads for loans that are due for repayment within 60 days of the date of issue. In the US, we also prohibit ads for loans with an APR of 36% or more,” the statement said.
The ban doesn’t affect companies that offer mortgages, auto loans, student loans, business loans, or credit card ads.
Google said it is vigilant not to advertise “counterfeit or harmful products” or those that “seek to mislead users about the companies they represent”.
In 2015, Google deactivated over 780 million ads.
“Financial services ads are a particular area of vigilance considering how important they are to the livelihood and well-being of people,” the statement said.
Wade Henderson, President and CEO of the Leadership Conference on Civil and Human Rights, welcomed the move.
“This new policy addresses many of the long-standing concerns of the entire civil rights community about payday predatory loans. These companies have long used shrewd advertising and aggressive marketing to entice consumers into outrageously high-yielding loans – often those who can least afford it. ”
Almost every year twelve million Americans Use Payday Loans.
These borrowers tend to have financial problems and rely on the loans for quick cash.
However, the US Consumer Financial Protection Bureau has called the loans “debt traps”. They usually have interest rates in excess of 100%, and borrowers often have to take out additional loans to pay off the original because of the short repayment window.
While the decision to ban payday loans is apparently voluntary, various international governments frequently urge Google to remove questionable ads and content. Google is actually one of the largest internet censors in the world.
For example, Google removed ads for Canadian pharmacies selling drugs to US customers. In this case, it was forced through a 2011 Justice Department settlement in which it paid $ 500 million. That dollar amount reflected how much Google made from the ads, combined with what the pharmacies estimated in sales.
CNNMoney (New York) Initial published May 11, 2016 at 10:13 am ET