Canadian Payday Loan Association Welcomes Balanced Payday Loan Regulations in Ontario
(Hamilton) March 13, 2009 - The Canadian Payday Loan Association said the new fee cap for payday loans announced by the Ontario government today will protect consumers from unscrupulous practices while allowing consumers continued access to payday loans as a needed and valued financial tool.
The Ontario government has set the maximum allowable fee to be charged for a payday loan at $21 per $100 borrowed - including all charges the consumer would pay.
"The government has taken a balanced approach that takes into account consumer protection and the viability of the industry to continue to provide this financial product to the consumers who need it," said the Hon. Stan Keyes, President of the CPLA. "But there's no question that some responsible lenders - including those serving smaller communities - will have to significantly tighten their belts to operate under the new cap."
Many of the elements of Ontario's new regulations are already part of the CPLA's "Code of Best Business Practices" - introduced four years ago and monitored by an independent Ethics and Integrity Commissioner to ensure compliance among CPLA members.
The CPLA has been actively working for five years with governments to pass legislation and implement maximum fees to ensure a balance between a viable industry and consumer protection.
In addition, the CPLA was a partner with the Ontario government in establishing stronger disclosure measures in stores and already promotes consumer education and awareness by posting credit counselling brochures in every member store.
Upwards of 2 million Canadians have used payday loans to cover small-sum, short-term emergencies. Loans are capped at $1,500, with the average loan being $280 for 10 days.
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For more information, contact:
Hon. Stan Keyes – President of the CPLA
(905) 522-2752
Email: stan.keyes@cpla-acps.ca