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Payday loan companies say city rules are redundant

Payday lenders say new municipal rules governing their industry are an unnecessary duplication of provincial consumer protections already in place.

“This already largely duplicates what payday lenders are already required to meet through the provincial government,” said Tony Irwin, president of the Canadian Payday Loans Association, of the restrictions imposed by the committee. Hamilton Planning Center.

The posters are quite large, so they are clearly visible to everyone.-Tom Irwin, President, Canadian Payday Loans Association

The new rules must be passed by the full city council before they come into effect.

“We are already approved by the province. We pay an annual fee of $ 990 per location and the province also requires us to post posters showing the rate; a poster that clearly shows how much the loan costs and one that actually compares the loan to a credit card, “he said.

The city’s rules come from a motion heard at a planning meeting on Tuesday. Initiated by Ward 3 Councilor Matthew Green, the new regulation requires payday lending establishments to pay an annual license fee of $ 750, post interest rates as well as comparative bank rates, and provide credit counseling to their clients.

Irwin said many of these services are already offered in locations across town.

A sample poster required by the City of Hamilton to be displayed at all payday loan offices in the city if the proposed by-law is passed by council in March. (City of Hamilton)

“The posters are quite large, so they are clearly visible to everyone.”

“Customers who come to payday loan stores, they understand how much the product costs and they are well aware the charges are explained so that they understand and know when they arrive what they are getting.”

Want to be accessible

When asked why credit checks are not done at these stores, Irwin responded by saying that “the people who come in for a payday loan are there because they may have had problems with their money. credit in the past, so individual businesses use different criteria to secure loans. in terms of how much they’ll provide someone. “

Regarding the location and why the majority of stores are located in downtown Hamilton, an area where the population is said to be low-income and low-income, Irwin said the locations are selected based on demographics, where people are located and where individual owners can find a suitable location for their business.

“Payday loan stores, like other types of businesses, want to be accessible where people are, so they want to be on the go. corridors, they want to be where the transit is, which is not uncommon for other businesses as well. “

Hamilton is on the cusp of being the first city in Ontario to regulate the payday loan industry. The draft regulation has not yet been ratified. He will pass the council on March 2.

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