On June 18, 2008 the Ontario Payday Loans Act, 2008 (hereafter known as “the Act”) received Royal Assent.
The Act applies to all payday loans in Ontario, and was passed in response to Federal Bill C-26. On May 3, 2007, Bill C-26, An Act to Amend the Criminal Code, came into force. Under the provisions of Bill C-26, a province that: (a) has a licensing regime in place for payday lenders; (b) has legislative measures that protect consumers of payday loans; and (c) provides for limits on the total cost of borrowing under payday agreements. If these criteria are satisfied, a province may request designation from the Governor in Council to be exempt from the Criminal Code interest provisions.
The Ontario Payday Loans Act, 2008 will permit Ontario to comply with the requirements for designation under federal Bill C-26.
The Ontario government has established the Maximum Total Cost of Borrowing Advisory Board to determine an appropriate maximum rate for payday loans. This board is an independent, advisory body that will provide a recommendation to the government on a total cost of borrowing rate for payday loans.
The Board’s mandate is to recommend an upper limit to the total cost of borrowing for payday loan agreements that payday lenders cannot exceed in Ontario. The Board’s deliverable will be a written report to the Minister of Small Business and Consumer Services recommending an upper limit to the total cost of borrowing that will be fair for borrowers while ensuring the long term viability of the payday lending industry in Ontario. This report may include different upper limits to the total cost of borrowing for different classes of borrowers.
The Board’s members have been selected for their expertise in financial services and public policy:
Mr. Paul Vessey
Mr. Vessey is a senior executive with over thirty years experience in financial services both in Canada and the United States. Mr. Vessey presently holds the position of Executive Vice President TD Bank Financial Group in charge of their US based retail and business banking product groups. Prior to this assignment he led TD Canada Trust’s retail lending and North American Credit Card business units. Prior to joining TD in 2003 Mr. Vessey was the Chief Operating Officer for Visa USA based in San Francisco, California leading the world’s largest card based payment system. Mr. Vessey has also held senior roles with both the Canadian Imperial Bank of Commerce and American Express Corporation.
Mr. Vessey serves as a director of Durham College of Applied Arts and Technology and Ontario University’s Foundation Board. He has previously served as a director of Visa International, Visa Canada, Toronto’s Women’s College Hospital and the Toronto International Film Festival.
Mr. Vessey is a graduate of the Advanced Management Program, Graduate School of Business Administration, Harvard University, Boston, Massachusetts. He is also a graduate of Business Administration, Durham College of Applied Arts and Technology, Oshawa, Ontario, Canada.
Mr. Brady Irwin
Mr. Irwin has worked in public policy/communications field since 1989, with several organizations within Ontario's broader public sector.
A long-time community activist, Mr. Irwin has served numerous community and volunteer roles. As a two term City Councillor for the City of Sault Ste. Marie, Treasurer for the Sault Ste. Marie District Social Services Board and Vice Chair of the Sault Ste. Marie Economic Development Corporation, Mr. Irwin has spent much of the past decade helping his community deal with the turbulent socio-economic conditions in Northern Ontario.
As President of the Sault Ste. Marie Soup Kitchen, he helped the neediest in his community; and, as Vice Chair of the Board of Directors of Ontario's newest university, Algoma University, he has had the opportunity to help Northern Ontario young people, including First Nations students, create a brighter future for themselves.
The Board will invite input from key stakeholders and the public to help inform the Board’s understanding of stakeholder issues and perspectives. The Board will soon be releasing a public consultation paper and seek submissions by interested parties to the consultation. To express your views on the consultation topics, please provide them in writing to:
(By mail)
Maximum Cost of Borrowing Advisory Board
c/o Ministry of Small Business and Consumer Services
5th Floor, 777 Bay Street
Toronto, ON M7A 2J3
(By e-mail)
paydaylending@ontario.ca
Comments to the Total Cost of Borrowing Board must be received by October 31, 2008.
The Board will also be developing a schedule for proposed face-to-face meetings with interested individuals, groups and organizations. If you wish to meet with the Board in person, please contact Jeff Hurdman at (416) 326-8882 or email paydaylending@ontario.ca.
