TfL excludes payday loan companies from big money sponsorships
Wonga.com and other payday loan companies are to be banned from signing major corporate sponsorships with Transport for London (TfL), following the highly criticised deal with Wonga for New Year's Eve 2010.
Wonga.com: TfL excludes payday loan companies from major corporate sponsorships
TfL traditionally offers revellers free travel on London buses and the London Underground between 11:45pm on New Year's Eve until 4:30am on New Year's Day as part of a deal with a corporate sponsor.
Wonga.com's deal to sponsor the free travel for New Year's Eve 2010 was highly criticised for giving the company highly prominent advertising and failing to display the typical APR of a Wonga loan, which is 4,214%.
Boris Johnson, Mayor of London, defended the deal in response to the criticism. He said: "We make no moral judgments about legitimate businesses that purchase advertisement space or sponsorship."
However, companies such as Wonga.com have come under increasing pressure in recent months and now TfL has indicated it will not do similar deals with payday loan companies in the future.
Graeme Craig, commercial development director at TfL, said: "TfL is currently working on a new sponsorship policy which will set out the type of companies from which TfL would, and would not, accept corporate sponsorship in the future.
Wonga.com, which is estimated to spend around £10m on advertising, will still be able to advertise on the outdoor sites on the London Underground, in Tube carriages, on buses and on outdoor sites in the inside of London buses.
A spokesperson for Wonga.com said in response to the TfL statement: "We held preliminary commercial discussions with TfL last year, but did not proceed as the structure of the deal and terms on offer had changed.
"The talks were positive, with no objections raised by TfL, and the decision was ours. We are an innovative company and we are always on the lookout for fresh projects. We therefore decided to focus on some new campaigns this time round."
In November last year, Ken Livingstone, the former London mayor and Labour candidate for mayor in the 2012 election, said that if he was elected he would ban high-cost credit companies from sponsoring or adverting on the Tube until a limit was placed on the costs of credit.
Stella Creasy, Labour MP for Walthamstow, has campaigned against payday loan companies and said taking a stand against them would "send a strong message to the Government that we need reform of our consumer credit market".
The 2011 New Year's Eve sponsorship was taken by Diageo, which struck a three-year deal, with a focus on responsible drinking messages.
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This article was first published on campaignlive.co.uk
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