The Reminder is making its archives back to 2003 available on our website. Please note that, due to technical limitations, archive articles are presented without the usual formatting.
New maximum interest rates for payday loans and additional consumer protection measures will take effect across Manitoba Oct. 18. The new maximum rate that can be charged for a payday loan is $17 per $100. The maximum amount of a loan can only be 30 per cent of a person's next net pay. Manitoba's rate is the lowest in the country among provinces that effectively allow payday loans. Additional regulations will include: terms and conditions in loan agreements must be disclosed in a way that is clear and understandable to borrowers; all fees are to be included in the cost of credit, whether or not they are optional; the maximum fee for a replacement loan is five per cent; lenders, including brokers, must be licensed and bonded; Internet lenders will be regulated, ensuring they operate with the same rules as a lender with a storefront location; written consent is required for a lender to verify a borrower's employment; and lenders cannot make unauthorized withdrawals from a borrower's account or use rewards or incentives to entice borrowers to get a loan. Proposed changes to Manitoba's Payday Loans Regulation were announced earlier this year. Now the federal government, which has authority to set interest rates, has issued an order to allow Manitoba to set rates for payday loans. These changes result from consultations with stakeholder groups like the Consumers' Association of Canada (Manitoba), Manitoba Society of Seniors, Winnipeg Harvest, the Canadian Payday Loan Association and a number of payday lenders.
