MHA Targeting Money Lenders
- SOURCE: VOCM.COM
- DATE: January 6, 2012
A St. John's MHA is pushing for regulations to deal with payday lending companies and their practices in the province. On VOCM Back Talk with Paddy Daly, Tory MHA Tom Osborne said he was shocked by a call he received from a constituent who recently ran into trouble with one of those companies. He says the man had borrowed $140 and was charged $267 plus an additional $20 fee just a month later. Osborne says he will push for regulations, similar to those in place in other provinces, to try to control how payday lending companies operate. He says the companies prey on people who are already vulnerable.
Meanwhile, Al Antle of Credit Counselling Services told VOCM Back Talk they deal with people who have run into trouble with payday lending companies on a daily basis. Antle says the companies typically operate just below the illegal interest rate of 69 per cent. Antle says the trouble is, the companies often charge additional fees on top of high interest. He says he's not sure why the industry is not regulated in this province like it is in other jurisdictions. Antle says the bottom line is that payday lending companies are legitimate businesses, and people just need to be aware of what exactly they're dealing with. He says from what they see, the service is used primarily by people at the upper end of the lower income scale and people at the lower end of the middle income scale. He says it's not unusual to see families bringing in 3 to 4 thousand dollars a month, having balances owed to payday lending companies.