Home Argentina crisis Council to vote on ban on future ‘predatory’ payday lender groups

Council to vote on ban on future ‘predatory’ payday lender groups

0

Content of the article

City council will vote on Monday on proposed land use rules that would ban new clusters of payday lending businesses, given concerns that these high-interest lenders have sprung up in low-income neighborhoods.

Publicity

Content of the article

Com. André Chabot welcomed the recommendation of municipal staff that payday loan outlets should be 400 meters apart, calling the proposed regulation a “good first step” to regulate these lenders.

Chabot said the separation distance was greater than he expected given city hall requires liquor stores to be 300 meters apart. But he said the move would limit the growth of payday lenders in the hopes that consumers would seek loans and financial advice from banks.

“It’s probably more evident in my area than anywhere else in the city, so for me (the proposal) is a good first step,” said Chabot, the councilor for Ward 10. “But it’s going to take a long time before that. to see how this will impact my communities because they are already there. “

Publicity

Content of the article

Payday loans are a short-term, high-interest form of credit that allows customers to borrow up to $ 1,500.

In Alberta, payday lenders are permitted to charge $ 23 per $ 100 borrowed, with the rate accruing over a short period. This is an interest rate of 600% on a $ 300 two-week loan at the maximum borrowing rate.

Last March, the city’s planning and urban development committee voted in favor of amendments to the land use by-law that would prohibit payday loan companies and pawn shops from being within 400 meters from another such business.

In Calgary, payday loan businesses are clustered along major corridors, including 17th Avenue SE, 36th Street SE, Center Street North, and Macleod Trail S.

According to a report to the council, businesses tend to be located where community household income is about 70 percent of the average household income in Calgary. The report also states that these communities have significant corridors, which is likely another factor in the location of payday loan companies.

Publicity

Content of the article

The administration says the 400-meter separation between businesses will help reduce future consolidation and create “viable local and mixed-use areas.”

Com. Druh Farrell said city hall has few regulatory tools to restrict the payday lending industry, but said the proposed regulation would limit the growth of “predatory” lenders focused on low-income neighborhoods.

“Somehow we’ve accepted this as normal, but it’s predatory,” Farrell said. “I hope the new provincial government will take stronger action.

The NDP government has signaled its intention to review payday loan regulations by next spring, stressing that consumer protection is a top priority.

Alison Karim-McSwiney says mayor’s efforts don’t go far enough. In a letter to the city’s land use planning department this summer, the executive director of International Avenue BRZ said her community was “saturated” with payday lenders.

“Since access to these services is so easy, it means that multiple payday loans can be taken out, resulting in a consumer going into debt into a multitude of debts,” Karim-McSwiney wrote.

“International Avenue BRZ supports the total moratorium on all payday loans and pawn shops in our area.”

[email protected]

[email protected]

Publicity

comments

Postmedia is committed to maintaining a lively but civil discussion forum and encourages all readers to share their views on our articles. Comments may take up to an hour of moderation before appearing on the site. We ask that you keep your comments relevant and respectful. We have enabled email notifications. You will now receive an email if you receive a reply to your comment, if there is an update to a comment thread that you follow, or if a user that you follow comments. Check out our community guidelines for more information and details on how to adjust your email settings.

LEAVE A REPLY

Please enter your comment!
Please enter your name here