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Ontario lowers fees for payday loans

By Nikolai Karpinski [1]

BELLEVILLE – Ontario is changing the maximum fee people will have to pay for short-term “payday loans.”

Starting Jan. 1, the top fee that can be charged by companies like Money Mart will be reduced from $21 to $18 for every $100 borrowed.

The cost will be reduced even further, to $15 for every $100 borrowed, starting Jan. 1, 2018.

The Canadian Payday Loan Association [2] says on its website that payday loans are “unsecured small-sum short-term loans typically for a few hundred dollars. The average payday loan is around $300 for a period of 10 days.”

The Ontario Ministry of Government and Consumer Services posted a press release [3] in November proposing other changes to the 2008 Payday Loan Act [4] and the 1990 Collection and Debt Settlement Services Act [5]. If passed, the changes would:

QNet News will be talking to local payday-loan operators and users to learn how these changes will affect them.