Canadian Payday Loan Association

Canadian Payday Loan Association

March 02, 2009 16:23 ET

Canadian Payday Loan Association Will Continue to Work With Government to Protect Payday Loan Consumers Under New Fee Cap

HAMILTON, ONTARIO--(Marketwire - March 2, 2009) - The Canadian Payday Loan Association (CPLA) today said the new government-instituted cap on payday loans will protect consumers from unscrupulous lenders while still allowing consumers to access payday loans as a needed and valued financial tool.

The British Columbia Government has set the maximum allowable fees to be charged for a payday loan at $23 per $100 borrowed - including all charges the consumer would pay.

"The government has taken a balanced approach to the payday loan industry, ensuring consumers are protected from the minority of those companies with bad business practices charging exorbitant rates, while still ensuring responsible lenders can viably operate and provide this legitimate financial product that consumers demand," said the Hon. Stan Keyes, President of the Canadian Payday Loan Association.

The CPLA has been actively working for 5 years with governments to pass legislation and implement maximum fees to ensure a balance between a viable industry and consumer protection.

Many of the elements of British Columbia's new regulations are already part of the CPLA's "Code of Best Business Practices" - introduced four years ago and monitored by an independent Ethics and Integrity Commissioner to ensure adherence by CPLA members.

Upwards of 2 million Canadians have used payday loans to cover small-sum, short-term emergencies. Loans are capped at $1,500, with the average loan being $280 for 10 days.

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