If you have yet to install ad-blocking software – and you’ve search for payday loans – then you’ve likely noticed the latest influx of payday loan ads on the Google search engine. Since a lot of payday loan companies are turning to the Internet to offer their service, there’s a growing number of online payday loan advertisements being scattered all over the online landscape.
Google is putting an end to this practice. The search engine juggernaut confirmed Wednesday that it will prohibit all ads from payday loans, referring to the industry as being “deceptive” and harmful” for consumers.
As of July 13, 2016, the tech titan will start to clampdown on the industry. In the summer, Google will not permit any ads for payday loans due within 60 days and ads for payday loans that come with an interest rate of at least 36 percent. This means payday loans will fall in the same category of other banned product ads, such as weapons, tobacco, hate speech and bombs.
It should be noted that the ban will not affect businesses providing auto loans, credit cards, student loans or mortgages.
Ultimately, says David Graff, Google director of global product policy, the company’s “hope is that fewer people will be exposed to misleading or harmful products.” He adds: “Financial services is an area we look at very closely because we want to protect users from deceptive or harmful financial products.”
Over the last several years, businesses that offer loans for bad credit with monthly payments have been the target of extreme vitriol from politicians, anti-poverty activists and consumer advocacy organizations. In the United States, 18 states have prohibited payday loans, and now the Consumer Financial Protection Bureau (CFPB) is looking to adopt federal regulations for the industry.
However, Google’s latest initiative could have a greater impact than any legislation would. The search engine handles more than two-thirds of online queries, and most of the ads you come across are based on your searches. If someone is looking for payday loans they won’t be exposed to related advertisements.
The payday loan industry has already responded to Google’s move. Amy Cantu, a spokeswoman with the Community Financial Centers Association of America, the trade group representing payday lenders, called the ban “discriminatory” and a form of “censorship.”
Tech experts say this is an impressive initiative on the part of Google, considering how lucrative payday loan ads really are for the search engine powerhouse.
“This is an impressive stance taken by Google to follow their ideology of ‘do not evil,'” said one search engine optimization consultant in an interview with The Memo. “The average cost of a paid advert on Google for ‘payday loans’ is around £11 ($16) per click and with over 200,000 searches in the UK per month, Google is giving up millions of pounds worth of revenue.”
It makes sense from a business stand point. Since the Google brand has taken a beating in recent years over privacy concerns, analysts say the company needs to be a lot more consumer-friendly. Scrutinizing financial services is definitely one way to change users’ perception of the website.