In this paper, Cardus continues its multi-year research associated with cash advance market in Canada and evaluates which policies will work, that aren’t, and just exactly exactly what yet continues to be unknown about payday advances, customer behavior, as well as the effect of federal federal federal government legislation regarding the supply and interest in small-dollar loans.

Executive Overview

The payday financing market in Canada is changing. Provinces across Canada have lowered interest levels and changed the principles for small-dollar loans. The aim of these policies is always to protect customers from unscrupulous loan providers, and also to reduce the possibility of borrowers getting caught into the period of financial obligation. just What spent some time working, and exactly exactly just what hasn’t? In this paper, Cardus continues its multi-year research regarding the cash advance market in Canada and evaluates which policies will work, that are not, and exactly what yet stays unknown about pay day loans, customer behavior, therefore the effect of federal federal government regulation regarding the supply and need for small-dollar loans. Our research suggests that quite a few previous predictions—including issues in regards to the disappearance of credit alternatives for those on the margins—have be realized. Moreover it demonstrates alternatives to payday lending from community finance institutions and credit unions have mostly did not materialize, leaving customers with fewer options total. [Read more…]