With the recent news of Google (and Facebook) banning adverts for the payday loan industry globally, Brokers should be concerned too.

Google cites the high interest rate of such loans and the need to protect their users from financial harm as reason for the ban. It is not hard to imagine Google, Facebook and other media companies caving to pressure to ban ads for Forex and Binary options, too, given the high percentages of customers losing money trading these products.

From a wider perspective, this move to ban payday lenders brings into question the role of media companies in censoring advertising and cherry picking industries it likes and doesn’t like. In many jurisdictions, payday lending is not against the law and in fact serves an important role in providing credit to those that need it most. High interest rates are necessary in order to protect against downside risk, and in economies of supply and demand (with a pinch of regulation), should achieve an equilibrium interest rate just above default rates.

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