Skip to content

Changes On Charges To Payday Loans

Victoria – New, lower charges for high-cost, short-term cash loans – payday loans – came into effect January 1, 2017.

The maximum allowable charge – including all fees – for a payday loan in British Columbia is $17 for every $100 borrowed, making it the second-lowest rate in Canada.

Lowering the total allowable charge to $17 from $23 builds on regulations the Province implemented in 2009. Before then, borrowers paid whatever the lender charged – as much as $30 per $100 borrowed, and had limited protections and recourse against harmful lending practices.

  • A payday loan is a loan of $1,500 or less for a term of 62 days or less.
  • Typically, borrowers have a bank account and a regular source of income. They provide a cheque or pre-authorized debit for the full amount of the loan, plus fees, to be repaid on their payday.
  • Payday loan companies doing business with B.C. consumers, including those operating online or by phone, must be licensed by Consumer Protection BC.
  • British Columbia’s laws provide a number of protections to payday loan borrowers including cancellation rights, disclosure requirements, prohibited practices and penalties for violations.
    • Payday lenders must publicly display the cost of credit, and disclose all charges, terms and conditions in the loan agreement.
    • They must not roll over one loan into another with new charges, nor issue more than one loan to a borrower at the same time.
    • A payday lender cannot issue a loan for more than 50% of a borrower’s net pay for the period over which the loan is written.
    • If a borrower is taking out his or her third loan in a two-month period, repayment must be phased over two or three pay periods
  • Through Consumer Protection BC, people who have been overcharged for these loans have recourse against the companies. Since 2012, several payday loan companies have been ordered to refund a total of more than $1 million to consumers who were overcharged.
  • Almost 159,000 British Columbians took out payday loans in 2015 according to information provided to Consumer Protection BC by the payday loan industry.

Learn More:

Consumer Protection BC:

Share This:

2022 Patricia Ross Election Ad

Willow Reichelt Election Ad 2022

Shirley Wilson Election Ad Abbotsford School Trustee

Barlynn Cleaning Services

604 392 5834

Locks Pharmacy


Small Business BC

Community Futures

Diabetes Association

Chill TV

Unique Thrifting


Error, no Advert ID set! Check your syntax!
Error, no Advert ID set! Check your syntax!
On Key

Related Posts