An independent regulator is calling on the Manitoba government to implement changes aimed at reducing the cycle of payday loan dependency. The Public Utilities Board’s 2024 review recommends extending repayment periods, allowing borrowers to pay in installments over 42 to 62 days instead of the current 14-day deadline. A similar law in Alberta has successfully reduced loan defaults.
Consumer advocate Chris Klassen emphasized the difficulty of repaying payday loans within two weeks, highlighting the risk of a vicious debt cycle. The board also advises the government to collaborate with credit unions to improve access to affordable credit and extend consumer protections to other high-cost loans.
Additionally, a recent order by the board has lowered the maximum fee for cashing government cheques, benefiting Manitobans who rely on financial aid. However, the Canadian Consumer Finance Association, representing payday lenders, declined participation in the review, arguing that changes should wait until the impact of new federal regulations is assessed.
Source: Swifteradio.com
