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New Report Card on Ontario Payday Loan Rule Changes

January 11, 2018

HAMILTON, ON – Ontario gets an F for the new interest rate caps placed on payday loan operations as of January 1st. That mark comes in a newly issued report card on the province’s new payday loan regulations by think tank Cardus. Cardus Work & Economics Program Director Brian Dijkema notes that capping interest rates offers marginal help to consumers, but doesn’t give them any real alternatives for when they’re desperate for a small, short-term loan.

“If you really want to help, bury the payday loan shops in competition so that consumers have better alternatives to predatory lenders,” said Dijkema. “You can cap interest rates all you want, but that doesn’t help anyone get off the payday loan treadmill.”

A previous Cardus study, Banking on the Margins, found that capping interest rates too aggressively could put payday loan operations out of business, possibly forcing some desperate borrowers to use underground, unregulated lenders who charge even more exorbitant interest rates.

By contrast, the province’s best mark is an A++ for moving to allow credit unions to provide alternatives to payday loan shops.

“This rule change is something we’ve recommended before,” says Dijkema. “Freeing credit unions – which are obligated to benefit their members and their communities – gives them space to try new things and to offer new products.”

To see the assessment of all the new rules and the full report card, click here.

To arrange an interview with Brian Dijkema, please, contact Daniel Proussalidis at

Daniel Proussalidis
Cardus – Director of Communications