Legislative amendments to the Consumer Protection and Business Practices Act were introduced yesterday in the House of Assembly to regulate high-cost credit lending in the province. Government recognizes that high-cost credit products may help individuals with no other options, and that consumer protections are necessary.
The amendments propose enhancing disclosure requirements, and prohibiting undisclosed fees, giveaways to encourage customers to take out loans and automatic payment deductions from a borrower’s pay cheque. A ‘cooling off’ period will also be enacted to allow a borrower to back out of a loan within four days, without penalty.
High-cost credit lending is a growing financial services sector, and this new legislation would make Newfoundland and Labrador the first Atlantic Province to implement a regulatory regime specific to high-cost credit lenders. Combined with the recently announced reduction in the maximum allowable payday loan rates, these amendments will significantly increase consumer protection for high cost credit consumers.
Other government initiatives to improve consumer protection include the Residential Tenancies Act, 2018, the Real Estate Trading Act, 2019, and amendments to the Automobile Insurance Act, Insurance Companies Act, Life Insurance Act and Securities Act.
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“Consumers who turn to high-cost lenders are often in a vulnerable position, and unfortunately it’s easy to become stuck in a cycle of payments. While recognizing that these credit products may help individuals who have no other options, we must work to ensure consumers are protected.”
Honourable Sarah Stoodley
Minister of Digital Government and Service NL
“Credit Counselling Services of Newfoundland and Labrador (CCSNL) has observed that many consumers find themselves indebted to high-cost lenders because borrowing from these lenders is simple and uncomplicated. Thank you Minister Stoodley for bringing forth these changes. It is a very good day for consumers in this province.”
Al Antle
Executive Director, Credit Counselling Services of Newfoundland and Labrador
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Learn more
Bill 13: Consumer Protection and Business Practices Act Amendment
Consumer Protection and Business Practices Act
Payday Loan Borrowing Rate Lowered
Payday Loan Legislation Now in Effect
Payday Loan Legislation Enhances Consumer Protection
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Media contact
Krista Dalton
Digital Government and Service NL
709-729-4748, 685-6492
kristadalton@gov.nl.ca
