The comments come ahead of a summit today bringing together payday lenders and consumer groups to discuss concerns about payday lending.

Consumer Minister Jo Swinson said: “Lenders are not living to the spirit or the letter of the codes of practice that they signed up to last year.”

The government and regulators previously announced a series of actions to tackle poor compliance in the payday lending industry, including clamping down on irresponsible practices and in some cases blatant non-compliance by lenders.

They have suspended licences of two payday lenders so far.

In a statement, Swinson said: “Evidence of significant widespread problems in the payday market is concerning. Earlier this year we and the regulators announced a strong action plan with immediate and longer term measures. Today we will be taking stock of progress and looking at what we do next to better protect consumers and address these problems.

“I have long had specific concerns about the advertising of payday loans and my department has commissioned research to look into the effect of payday lending advertising on consumer behaviour. My department will be publishing the research in the autumn.”

At the summit the Office of Fair Trading will give an update on enforcement action they have been taking including and the Financial Conduct Authority, which will oversee consumer credit from 1 April next year, will give a flavour of what its rulebook might contain and how it might regulate the market from 2014.

Gillian Guy, chief executive at Citizens Advice, has called for tough new rules to stop irresponsible advertising and end celebrity endorsement of financial products.

She said: “We need to see tough action on advertising, with new rules brought in which would end wall-to-wall advertising on daytime TV and stop the use of glossy celebrity endorsements which conceal the misery of life in debt. Much more needs to be done to make the cost of loans and consequences of late repayments clear, and to end the focus on speed rather than affordability.”

Citizens Advice evidence has found that payday lenders are still failing to treat people fairly, breaking 12 of the 14 promises they laid out in their customer charter.