So the Government of B.C. is going to establish a licensing system for payday lenders. Ottawa plans some changes. But is this going to be enough? MoneyMart welcomes the news, supposedly. But licensing does not mean regulating to much of any extent. This is possibly the key to managing this ‘industry’. Loan rates of 60% are nothing but usury. They are allowed but really do the math. No notice of how the interest is calculated or charged. Once you compound the math how long does it take to double the loan?
The most interesting point though, and one that is not mentioned, is the disgusting methods these companies use to collect their debts. I have seen examples of individuals cashing a cheque which had a legal stop payment put on it. The means of recourse is the payee not the drawer but they insist on going after the drawer and they will use any means to get their money. It borders on the savage to say the least. People should know their rights in regards to issuing cheques and cheque cashing but when these organizations abuse these rights where do they go to lodge their concern and complaint? Their only course is a court of law when it should be an government agency that monitors and regulates. Banks, trusts, and credit unions have these but not the payday lenders. It does seems strange that the weakest and most vulnerable have so few avenues left to them. Payday lenders remind me of that small, vicious, South American fish.