The Provincial Government is lowering the maximum total cost of borrowing by a payday lender from $21 per $100 loaned, to $14 per $100 loaned, making Newfoundland and Labrador’s cost of borrowing the lowest in the country.
Payday loans are for small amounts of less than $1,500, with payment terms under 62 days. Payday loans are regulated in the province through the Payday Loans Regulations, which came into effect in April 2019, under the Consumer Protection and Business Practices Act.
Over the past few years, other provinces have also lowered the maximum cost of borrowing for payday loans. Six provinces have established a cost of $15 per $100 loaned, and Nova Scotia has approved a maximum cost of $15 per $100 loaned, effective January 1, 2024.
The amended Payday Loan Regulations have been published in the Newfoundland and Labrador Gazette. The rate change will be effective December 15, 2022.
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“Government recognizes that such credit products may help individuals in difficult situations, and it’s important that payday loan clients are not exploited. I would recommend that clients needing short term cash consider all the financial options available to them and please read the fine print. All advertisements for payday loans must explicitly state the total cost of borrowing including interest, fees and charges.”
Honourable Sarah Stoodley
Minister of Digital Government and Service NL
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Learn more
Payday Loan Regulations
News Release: Payday Loan Legislation Now in Effect
News Release: Payday Loan Legislation Enhances Consumer Protection
Consumer Protection and Business Practices Act
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Media contact
Krista Dalton
Digital Government and Service NL
709-729-4748, 685-6492
kristadalton@gov.nl.ca