B.C. tightens payday lending practices, protecting most vulnerable
The Government of Alberta has announced a new, lower, rate for payday loans in the province with the intent to keep low income residents out of a cycle of debt.
The Canadian Press
Published Tuesday, June 26, 2018 10:11AM PDT
VICTORIA - New limits on fees for cashing cheques and high-cost loans will take effect on Sept. 1 in British Columbia.
Solicitor General Mike Farnworth says in a statement the changes tighten the rules for payday-loan businesses and aim to protect people from paying high fees to cash cheques and borrow money.
Farnworth says the changes will help some of B.C.'s most vulnerable people who use non-traditional lenders and credit providers to cash social assistance or disability cheques.
The changes that go into effect Sept. 1 include: lowering the maximum fee to $15 for every $100 borrowed and capping the fee for cashing a social assistance or disability cheque at $2, plus one per cent of the value of the cheque, up to a maximum of $10.
The minister says the changes also prohibit payday lenders from requiring, requesting or accepting consent to use or disclose the personal information of a borrower for anything other than arranging or providing a payday loan.
B.C.'s social development ministry says people in B.C. took out 805,000 payday loans in 2016, for a total of $369 million at an average of $460 per individual loan.