Home В» Blog В» Why the Ontario Government Did come down Hard nвЂ™t adequate regarding the pay day loan Industry
Payday advances are an issue. The attention price charged is massive. In 2016, payday loan providers in Ontario may charge no more than $21 on every $100 borrowed, therefore in the event that you borrow $100 for a fortnight, repay it with interest, and then duplicate that period for per year, you get spending $546 from the $100 you borrowed.
ThatвЂ™s a yearly rate of interest of 546%, and thatвЂ™s a huge problem however itвЂ™s not illegal, because even though the Criminal Code forbids loan interest greater than 60%, you can find exceptions for short-term loan providers, to allow them to charge huge interest levels.
Note: the most price of a pay day loan ended up being updated in Ontario to $15 per $100.
The Ontario federal government does know this is an issue, therefore in 2008 they applied the payday advances Act, as well as in the springtime of 2016 they asked for feedback through the public on which the utmost price of borrowing a loan that is payday take Ontario.