The payday loan industry will soon have several new regulations in Nova Scotia.
The rules came after changes were made at the federal level and the Utility and Review Board investigated what should be done on the provincial side, a Service Nova Scotia and Municipal Relations news release said yesterday.
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The regulations cap maximum interest rates at 60 per cent per year, cap maximum flat-rate default fees to $40 and mandate the total cost of borrowing must not exceed $31 per $100, the release said.
Other changes include banning automatic loan rollover dates from being set prior to a customer’s next payday, and forcing lenders to provide complete disclosure to clients about costs and fees before they provide personal information. Payday lenders will have to be licensed and will be required to file annual reports to the province.
The Canadian Payday Association said yesterday it’s pleased that Nova Scotia has taken the step of becoming the first province to officially regulate the industry.
“Nova Scotia has shown great leadership in protecting consumers,” association president Stan Keyes said in a news release. “Our members look forward to operating fully within the new laws and regulations.”
There are 13 payday loan companies with about 40 outlets operating in Nova Scotia, the provincial government says.