Monday, April 30, 2007
The Ontario government is strengthening protections for consumers who access the payday lending industry, said Government Services Minister Gerry Phillips.
"Our government is introducing new protections to offer Ontarians who use payday loans more transparency and fairness," said Phillips. "We will require payday lenders to display the cost per hundred dollars of their loans."
Ontario has approved much stronger protections for users of payday loans
in regulations under the Consumer Protection Act. These regulations will:
- Require payday lenders to post on-site in a prominent place a poster
outlining the cost per one hundred dollars to obtain a payday loan
- Ensure that consumers receive standardized disclosure of critical
information by requiring the lender to use a prescribed standard-form
contract
- Ensure that consumers are advanced their payday loan funds
immediately upon signing their agreement.
The federal government recently passed legislation that will allow
provinces to further regulate the payday lending industry. Further regulation could include licensing, a consumer protection framework and regulating the cost of borrowing for the payday lending industry. Ontario has been urging the federal government to regulate the payday lending industry, including interest rates, as a national standard would ensure uniform protection for all Canadians.
"Now that the federal government has chosen to hand this responsibility to the provinces, Ontario is acting to provide appropriate consumer protection measures for payday lending," said Phillips.
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