Payday loan sharks have been banned from advertising at the University of Sheffield in a bid to cut the number of under 25s who borrow from payday lenders. 

This follows a recent think tank report which highlighted that under 25s were the largest group to borrow from payday lenders in September 2012.

September 2012 was the first academic year where students were charged the higher tuition fees of £9,000 a year.

The ban will mean payday lenders will not be allowed to promote their services to students at events run by the University of Sheffield and Students’ Union, with efforts being stepped-up to raise awareness of the financial support and guidance available.

This ban comes in support of a Private Members Bill raised by Sheffield Central MP Paul Blomfield to regulate payday money lenders who are often just pushing people further into debt as a result of their high interest rates, charges and misleading advertising.

The ‘High Cost Credit Bill’, which will receive its second reading on Friday 12 July 2013, will include provisions to control advertising and marketing of high cost credit products, and to ensure clearer information is provided to borrowers on the cost of loans and on additional charges levied if they fail to repay.

The bill will also include new measures to ensure that loans are affordable by introducing lending limits and capping excessive charges. It will also protect borrowers having problems with repayment by requiring lenders to refer them to free independent debt advice, freeze charges and ensure that proper repayment plans are put in place.

The Financial Conducts Authority is also reviewing the payday loans industry, and looking at ways to restrict where it can advertise and target customers.

Catherine McKeown, head of financial support at the University of Sheffield, said: “Over the past 12 months we have noticed a worrying increase in students in financial hardship as a direct result of taking payday loans either prior to commencing their studies or at varying stages during their time as a student, including those at postgraduate level.

“The problem is that this type of borrowing is so easily accessible to young people, many of whom have never had to manage money before.”

The University of Northampton, Swansea University and Northumbria University have all also agreed to ban payday money lenders’ adverts on their sites.