Ontario considering legislation to increase consumer protection
Ontario will introduce legislation to increase protections for consumers who use the more than 800 high-cost alternative financial services, such as payday loans, installment loans, rent-to-own services and cheque-cashing services, and to better protect those with debts in collection.
If passed, the Alternative Financial Services Statute Law Amendment Act would make amendments to the Payday Loans Act, Consumer Protection Act and the Collection and Debt Settlement Services Act that would increase protections for consumers in several important new ways.
Consumers cashing cheques at alternative financial service providers would have more information made available to them and would benefit from a cap on the rate of cheque-cashing services. Individuals using rent-to-own services would benefit from a grace period for repayment. Consumers using installment loans would be certain that the costs of optional insurance would not be excessive. Repeat payday loan borrowers would have the option of a longer repayment period. Consumers with overdue debts would benefit from expanded rules against unfair collection practices used by businesses that purchase and collect overdue debts.