Wednesday, March 14, 2012

Heads Up about unlicensed payday lenders

March 13, 2012


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Loansalberta Inc. Offering Internet Payday Loans Without Licence
The Manitoba Consumer Protection Office is cautioning consumers to beware of Internet payday loans offered by Loansalberta Inc., as this company is not licensed under the Consumer Protection Act to offer, arrange or provide payday loans to Manitobans.
Manitoba law requires that all payday lenders offering, arranging or providing payday loans to Manitobans be licensed by the Consumer Protection Office and comply with the Manitoba regulatory framework.  This includes payday lenders who offer loans to Manitobans over the Internet, regardless of where their head offices are located.
On Sept. 14, 2011, the director of consumer protection issued an order directing Loansalberta Inc. to immediately refrain from offering, arranging and providing payday loans in Manitoba in any manner, as it did not have a licence under the Consumer Protection Act.  The director further ordered the company to continue to refrain from offering, arranging and providing payday loans in Manitoba for as long as Loansalberta Inc. does not have a valid licence.  To date, Loansalberta remains unlicensed.
Manitoba consumers are urged to exercise caution with respect to Internet payday loans offered by this or any other unlicensed payday lender, as they will not have access to the additional oversight and protection that licensing provides.
Consumers are also reminded of the protections provided by the regulatory framework for payday loans in Manitoba:
  • Manitoba law limits the maximum fees that can be charged for a payday loan to $17 per $100 borrowed and, in some cases, to $5 per $100 borrowed;
  • if a payday lender charges more than this maximum fee, it must, on demand by the borrower or the director, repay the consumer the entire amount of fees charged for the loan;   
  • payday loans can be cancelled within 48 hours without paying any charges;
  • payday lenders cannot require repayment of a loan before the borrower’s next payday; and
  • payday loan agreements must list all charges and the terms of the loan.
Borrowers cannot be required to buy prepaid cards, insurance or other options that may be offered.  These and any other rights payday loan consumers have under the act and regulations apply whether or not the payday lender is licensed. 
Consumers taking out payday loans should ask questions about anything they do not understand and should not sign any documents or agree to Internet loan conditions that are not clear.
Consumers who have questions about Manitoba’s payday lending rules or are concerned about their payday loans can contact the Consumer Protection Office at 204-945-3800 or 1-800-782-0067
(toll-free) or email
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