Payday Loans Canada Regulations, New Rules and Regulations Canada Payday Loans, Canada Payday Loan Laws, Consumer Protection Canada Payday Loans, Canada and Canadian Payday Loan Legislation

Payday Loans Canada Regulations

Criminal Code of Canada defined as, if the interest rates are charged more than 60% per year it is considered as criminal. On August 14, 2006, the Supreme Court of British Columbia announced its judgment in a class action lawsuit against A OK Payday Loans. A OK charged its consumers 21% interest rate, in addition to a "processing" charge of C$9.50 for each $50.00 on loan. And more a "deferral" fee of $25.00 for each $100.00 was charged if a consumer sought to postpone his payment. The judge ruled that the processing and deferral fees were interest, and that A OK Payday Loans was charging its consumers a criminal rate of interest. The payout as a result of this decision is expected to be several million dollars. The British Columbia Court of Appeal generally affirmed this judgment.

In 2006, the Criminal Code of Canada was amended to permit for Provinces to legalize the payday loan industry.

Since November 1, 2009, the Payday Loans Regulation has been in force in British Columbia. The maximum charges for short term loans have been capped at 23% of the principal (including interests and fees), the borrower can cancel the payday loan by the end of the following day of signing the agreement without paying any charge, only 1 loan per borrower at a time is permitted, and the payday loan lenders ability to access the borrower's bank or employer has been restricted. In addition, payday laon lenders are prohibited from lending more than 50 percent of a borrower's take-home pay or requiring repayment before the borrower's next payday. All payday loan lenders are required to register and are regulated under the Business Practices and Consumer Protection Authority (also known as Consumer Protection BC).

In June 2010, the government of Saskatchewan announced regulations on payday loans similar to those in British Columbia. They include an interest rate cap of 23% of the principle, a cap of 30% on a defaulted loan, and a borrowing limit of 50% of the net amount of the individual's next pay. Companies offering payday loans will be charged a licensing fee of $2,000 per location.