News release

Consumers and Business to Benefit from New Credit Rules

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

SERVICE N.S./MUNICIPAL RELATIONS--Consumers and Business to Benefit from New Credit Rules


Consumers and businesses in Nova Scotia will benefit from changes to credit laws introduced today.

Angus MacIsaac, Minister of Service Nova Scotia and Municipal Relations, is keeping a government promise by tabling a bill to change the Consumer Protection Act and the Mortgage Brokers' and Lenders' Registration Act.

Under the proposed changes, Nova Scotians who borrow money in the future would have better information, such as an annual percentage rate, to evaluate loan options. They could also cancel and receive refunds for optional services and will receive advance notice of any default charges. Also, for the first time, these disclosure rules and consumer rights would extend to leases for consumer goods.

The minister said businesses would benefit because Canada's federal, provincial and territorial governments are committed to having a common set of rules for lenders instead of the maze of regulations that exist now.

"These are win-win amendments that strengthen consumer protection, while reducing red tape for business," said Mr. MacIsaac. "Consumers will have more protection, while businesses can lower their operating expenses."

The new rules would apply to anyone who provides or brokers mortgages or consumer loans, including credit card issuers, trust companies and retailers who finance client purchases. Federally chartered banks are not subject to Nova Scotia's legislation but will be covered by similar federal regulations.

The changes stem from a federal-provincial agreement to harmonize cost of credit disclosure regulations. Following extensive discussions with consumer and business groups, a template was adopted as a model for legislation. British Columbia and Alberta have passed legislation similar to the amendments introduced today and other jurisdictions are drafting comparable legislation.

When all jurisdictions are on board, consumers across the nation will be able to compare borrowing options and make better- informed decisions. Businesses will benefit by effectively having one set of rules that apply throughout the country instead of up to 14 sets of loan disclosure regulations.

Highlights of the proposed amendments:

  • introducing the annual percentage rate (APR) as a method of calculating and disclosing the cost of borrowing for consumer loans;
  • standardizing the timing and content of disclosure statements that lenders must provide consumers;
  • requiring status-of-loan updates to co-signers;
  • requiring written approval from co-signers before additional credit is extended to a borrower;
  • requiring cost of credit disclosure for leases of consumer goods;
  • specifying advertising requirements specific to each type of credit arrangement.