MONCTON – New Brunswick NDP Leader Dominic Cardy said an NDP government would introduce legislation to protect New Brunswickers from the predatory practices of payday lenders. Cardy made the announcement at a campaign stop in Moncton Tuesday morning.
It has been industry practice to offer short term loan packages that exceed the usury interest rate of 60 percent set out in the Criminal Code of Canada. A previous investigation in Onatrio found fees and interest charged on a two-week loan – when combined and calculated as an annualized percentage rate – ranged from 390 to 891 per cent.
“These companies target the most financially vulnerable,” Cardy said. “This is unfair, this is illegal and the new NDP will put a stop to it.”
Cardy said the new NDP would follow the lead of Ontario which introduced similar legislation earlier this year. The proposed legislation would put a ceiling on the amount of interest payday loan companies can charge New Brunswick customers.
The proposed law would also establish an inspection and enforcement regime as well as ban controversial lending practices such as issuing concurrent and back-to-back loans.
“The new NDP will offer New Brunswick consumers real protection and these companies are going to have to obey the law,” Cardy said.