A leading consumer lobby has claimed that online payday lenders are not meeting their obligations under the tighter rules that were introduced in March. In a report issued yesterday, the Consumer Action Law Centre called on the Australian Securities and Investment Commission to conduct a full-scale review of disclosure practices in the sector.New payday lending rules that took effect in March imposed caps on the cost of credit, and tougher responsible lending standards.They also included a requirement that warnings be displayed that encouraged consumers to consider alternative and lower cost options before taking out a payday loan. These warnings must be provided on lenders' websites and in stores, and must also be read out during telephone discussions.The Consumer Action Law Centre reviewed the online warnings of seven lenders - Nimble, Money3, Cash Converters, Cash Store, Cash Train, Credit24 and Teleloans.It found that all had introduced warning disclosures but there were problems. Warnings were not displayed in a way that would attract attention. And warning text, which is specified in regulations, was also incomplete or incorrect.In some cases, consumers did not have to acknowledge the warning, as required, before accessing a loan application.The centre's report is well timed, coming a day after ASIC confirmed Ferratum Australia, the local arm of a European-based 'microloan' company, had paid an infringement notice penalty of A$10,200 for false or misleading advertising.The payment, made on 15 October, followed an investigation by ASIC into a 'free $100 loan' advertised on Ferratum's Australian website, www.cashinahurry.com.au. This 'free loan' promotion also ran in television advertisements, on automatic teller machine screens and in Google text and display advertisements between 24 May and 31 July 2013. The first $100 of the loan attracted transaction fees, however, which, ASIC said, constituted 'reasonable grounds' to conclude the promotion was misleading."The word 'free' conveys a strong impression and should not be used where there is any charge to use the product," ASIC stated, when announcing the penalty payment.In addition to paying ASIC, Ferratum has refunded all transaction fees paid by clients who took out loans of $100 during the promotion period.