Minister Baroness Jolly said the Broadcast Committee of Advertising Practice (BCAP) had been asked to assess how children could be better protected by considering changes to advertising scheduling.
BCAP will look at how content and timing could be improved and use of the 9pm watershed was raised as one way to stop children seeing and being influenced by the adverts.
The Lord Bishop of Birmingham said payday adverts were unsuitable for children and corrosive to the family.
The lords discussed the use of puppets and elderly figures in adverts used by Wonga as a tactic to appeal specifically to children although Baroness Jolly said she thought they were used because of their widespread appeal, not just to children.
In a survey carried out earlier this year for The Children’s Society, three-quarters of British parents (74%) said they wanted payday loan companies to be banned from broadcasting TV and radio adverts to children.
The name recognition of payday loan firms among teenagers is extremely high, with 93% knowing at least one of eight top payday loan companies. More than half of children (55%) were able to recognise at least three lenders.
One third (34%) of children surveyed found payday loan adverts to be fun, tempting or exciting – and this group were significantly more likely to say they would consider using a payday loan in the future.
Matthew Reed, chief executive of The Children’s Society, said: “Today’s decision by government to ask the advertising watchdog to review the rules on when payday loan adverts can be broadcast on TV and radio is a positive step. We welcome ministers’ recognition that the impact of such advertising on children is a major cause for concern. We will be passing our evidence to the watchdog and will be pushing for an early decision to ban these ads before the 9pm watershed.”
