The pros and cons of payday loans
Across the country, payday loan companies market the ease and convenience of borrowing a couple hundred dollars to get their customers through the week.
But it's the paying back part that can make these loans tricky. In Manitoba, it will cost you $17 for every $100 borrowed. The fee is $21 in Ontario, and $23 in B.C., Alberta and Saskatchewan.
Scott Gilmore of Maclean's magazine recently learned the hard truth about easy money, first-hand - and he thinks things need to change. But payday loan industry spokesperson Stan Keyes says payday loans are often misunderstood.
This week on The 180, we hear both perspectives.
Scott Gilmore was mistakenly targeted by a loan company, recently, for debt owed by someone with his same name:
It was strange to discover a doppelgänger and to look into his life that way, voyeuristically, but what stunned me was I realized that he was paying approximately 400 per cent on that loan and he clearly couldn't afford it. And I began to read about it and learn more about it and what I found about the state of the payday loan industry in Canada was flabbergasting.- Scott Gilmore
Stan Keyes is President of the Canadian Payday Loan Association, which represents the majority of licensed lenders in Canada. He says licensed payday lenders don't deserve the vilification they often suffer:
No lender wants a borrower not to pay back the loan. And the law, the regulation in Ontario and every other province, is very clear: a licensed lender cannot extend the loan for a fee.- Stan Keyes