PIAC Media Releases

Brand New PIAC Report: Enhancing Protection for Payday Loan Consumers in Canada

OTTAWA – An innovative new research report posted because of the Public Interest Advocacy Centre (PIAC) suggests that numerous cash advance users stay unacquainted with their legal rights, and locate it difficult to calculate payday advances’ high rates of interest and allied cash advance coupons expenses. Repeat borrowing and debt-cycles that are continuous to prevail, with several users uninformed on the best way to cope with financial obligation rounds, and better manage their funds.

The study shows that the current federal government resources on pay day loans, i.e., provincial information internet sites and complaint filing processes can be underused, as many cash advance users don’t know of the existence. “Payday loan users’ shortage of awareness about their legal rights and current redress systems is concerning, provided the alarmingly high rates of interest and expenses of pay day loans, it is time that prompt action is taken up to address these records deficit,” said Tahira Dawood, Policy and Research Analyst at PIAC.

Other redress mechanisms for handling loan that is payday, that the Report additionally learned, stay problematic. Actions such as for instance filing a claim in tiny claims court is, in accordance with the quantities included therefore the way of cash advance uses, expensive, time intensive and burdensome. Complaints made straight to payday loan providers, while useful to some borrowers, currently lack the transparency and accountability needed seriously to protect the vulnerable adequately users of payday advances. During the time of research, no readily available general public information had been discovered in regards to the quantity and nature of pay day loan complaints made, their response times and results.

“Payday loans are ‘expensive’ for customers since the repayment is born therefore soon, not merely as the interest is high,” stated John Lawford, Executive Director and General Counsel, PIAC. “Payday loan clients make smarter economic alternatives if this obscure simple truth is explained – in addition they can learn fast and begin saving cash straight away,” he added.

The report’s key suggestions therefore are:

To begin to see the complete report, be sure to begin to see the link that is following.

To look at sample user-friendly guide made by PIAC, please see the after website link.

People Interest Advocacy Centre has received capital from the statutory Law Foundation of Ontario, under its use of Justice Fund (ATJF). The Public Interest Advocacy Centre is solely responsible for all content while financially supported by The Law Foundation of Ontario.

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