Bill 234 explained in plain English
Payday Loans Accountability Act, 2020
Ontario legislature bill summary, status, timeline, sponsor, votes, and official sources.
At a glance
Official Legislative Assembly of Ontario snapshot for 42nd Parliament, 1st Session. Representative vote breakdowns appear when the Assembly publishes an Ayes and Nays page for the bill.
Our plain-language take, written for civic education.
Source: By PoliticalData.ca
This bill amends the Payday Loans Act, 2008, to establish a Borrowers' Bill of Rights, mandate lenders to provide it to borrowers, allow for rescission of loan agreements if not provided, and create a Payday Loans Task Force.
Bill 234, also known as the Payday Loans Accountability Act, 2020, proposes to amend the Payday Loans Act, 2008. It aims to increase lender accountability and borrower protections. Key changes include establishing a "Borrowers' Bill of Rights" outlining principles for fair interest rates and transparent dealings, and requiring lenders to provide this bill of rights to borrowers before a loan agreement is made. If this is not provided, borrowers may be able to cancel the agreement. The bill also proposes the creation of a Payday Loans Task Force to study the payday loan industry and make recommendations to the Minister. Additionally, it introduces a definition for "instalment loan" and sets a limit on the maximum annual interest rate that can be prescribed by regulation for payday loans.
- Establishes a "Borrowers' Bill of Rights" that sets out principles for interpreting the Payday Loans Act, 2008, including the right to fair interest rates and transparent dealings.
- Requires lenders to give borrowers a copy of the Borrowers' Bill of Rights before entering into a payday loan agreement.
- Allows borrowers to rescind a payday loan agreement without penalty if the lender fails to provide them with the Borrowers' Bill of Rights.
- Establishes the Payday Loans Task Force, which will examine payday loan regulations in other jurisdictions, investigate causes for reliance on payday loans, explore alternatives, review loan data, and make recommendations on interest rates and transparency.
- Adds a definition for "instalment loan" to the Payday Loans Act, 2008.
- Sets a limit on the maximum annual interest rate that can be prescribed by regulation, ensuring it does not exceed 40 per cent on an annual basis.
- Requires the Payday Loans Task Force to make recommendations to the Minister within one year of the bill receiving Royal Assent, and every five years thereafter.
- Requires the Minister to appoint at least 12 members to the Payday Loans Task Force within 60 days of the bill receiving Royal Assent.
- Payday loan lenders in Ontario
- Individuals who borrow money through payday loans or instalment loans in Ontario
- The Minister of Finance (responsible for the Payday Loans Task Force recommendations)
- Members of the public seeking to understand their rights as borrowers
- Borrowers have the right to a fair and just maximum annual interest rate on payday and instalment loans.
- Borrowers have the right to access a fairly regulated industry.
- Borrowers have the right to transparent dealings with lenders, including online lenders.
- Lenders are obligated to provide borrowers with a copy of the Borrowers' Bill of Rights before entering into a payday loan agreement.
- Borrowers have the right to rescind a payday loan agreement if the lender fails to provide the Borrowers' Bill of Rights.
- The Payday Loans Task Force has a mandate to examine and recommend improvements to the payday loan industry.
- The Act comes into force on the day it receives Royal Assent.
- The Minister must appoint at least 12 members to the Payday Loans Task Force within 60 days of the bill receiving Royal Assent.
- The Payday Loans Task Force must make its first set of recommendations within one year of the bill receiving Royal Assent.
- The Payday Loans Task Force must make subsequent recommendations every five years thereafter.
- A limit is established on the annual interest rate that can be prescribed by regulation for payday loans, preventing it from exceeding 40 per cent on an annual basis.
- The Lieutenant Governor in Council may regulate remuneration and expenses for members of the Payday Loans Task Force.
- If a lender fails to provide a borrower with the Borrowers' Bill of Rights, the borrower may rescind the payday loan agreement without penalty or obligation.
- The specific meaning of "instalment loan" is set out in the regulations, which are not provided in this bill.
- The specific time frame and process for a borrower to rescind a payday loan agreement (beyond the general requirement of "accordance with the regulations and within the prescribed time") are determined by regulations.
- The exact composition of the Payday Loans Task Force is determined by the Minister.
- The remuneration and payment of expenses for Task Force members are subject to regulation by the Lieutenant Governor in Council.
The bill amends various sections of the Payday Loans Act, 2008, including adding a definition for "instalment loan", establishing a limit on the cost of borrowing prescribed by regulation, introducing a "Borrowers' Bill of Rights", creating provisions for the rescission of loan agreements if the bill of rights is not provided, and establishing the Payday Loans Task Force. It also adds powers to make regulations regarding instalment loans and the rescission of payday loan agreements.
Source: Sections 1, 2, 3, 4, 5, and 6
Generated using AI from official bill text. Not legal advice. It is written by PoliticalData.ca for civic education, automatically checked and spot-reviewed before publishing.
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Official sources
Status, sponsor, votes, and timeline on this page are drawn from these official legislative sources and public records. Each summary above is attributed to its own source.
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