April 3, 2008

NEWS          
                                                                                                            Ontario has introduced legislation to help protect individuals an families that use the services of payday lending operators.    

If passed, the new Payday Loans Act will further consumer protection by licensing all payday lending industry operators and banning unfair lending practices.  

To protect individuals and families that need access to short-term loans, this legislation, if passed, will set a limit on a total cost of borrowing, prohibit back-to-back and concurrent loans, permit borrowers to cancel loan agreements without penalty within 48 hours and impose serious penalties for lenders in violation of the Act.  

An independent advisory board of experts, business representatives and poverty advocates will examine the costs for payday loans and recommend a cap on total costs of borrowing.  

The proposed Payday Loans Act would also create an education campaign to educate consumers in financial management and inform them of the risks associated with high-cost credit.  

QUOTES  

“This legislation, if passed, will help prevent pay day lenders from taking advantage of poor families’ vulnerability” said Deb Matthews, MPP London North Centre. “In 2004, I put a motion before the house calling on the government to take steps to ensure that consumers are protected from excessive charges and hidden costs in the payday loan industry. I am so pleased that our government is taking action to improve options for Ontarians who rely on this service.”  

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