Starting today the first phase in the province’s move to end predatory lending takes effect.
Alberta is reducing maximum borrowing fees from $23 to $15 per $100 borrowed, making it the lowest rate in Canada.
Payday lenders will no longer be able to charge a fee to cash a payday loan cheque, solicit directly by email or phone, or offer a loan when another is outstanding.
The legislation also requires government to encourage banks to offer alternative, short-term loans that are fair and accessible.
Service Alberta Minister Stephanie McLean says this is the first step with more changes to come in effect later this year.
“Last fall, Albertans told us they want lower interest rates and stronger consumer protections. Today, it’s the law. We have put an end to 600 per cent predatory interest rates and vicious cycles of debt, with fair rules that protect Albertans.”
More than 30 payday loan companies currently operate more than 220 branches in Alberta.