News release

UARB Reduces Cost of Payday Loans

Service Nova Scotia and Municipal Relations (Oct. 2000 - March 2014)

The Utility and Review Board is reducing the cost of payday loans.

Effective April 1, the maximum allowable cost of borrowing on payday loans will be $25 per $100, instead of the current $31.

The UARB recommended that lenders should be required to disclose the cost of borrowing in advertising and to file information on repeat loans with Service Nova Scotia and Municipal Relations. The department is reviewing these recommendations.

"Consumers should remember that payday loans are high-cost loans," said John MacDonell, Minister of Service Nova Scotia and Municipal Relations. "Before borrowing any money, a consumer should shop around. Not all lenders charge the maximum rates."

Mr. MacDonell also added that consumers should also be aware that regulations prohibit payday lenders from requiring a consumer to purchase any other product or service to take out a loan. This includes bank accounts and insurance.

For more consumer information on payday loans, visit www.gov.ns.ca/snsmr/consumer/paydayloans/default.asp.