Filling the Gap—Canada’s Payday Lenders
The Conference Board of Canada, 74 pages
November 28, 2016
The payday loan industry has an unfavourable image with the public, and politicians and the media mainly discuss it in a negative light. Despite its unfavourable reputation, the licensed payday loans industry provides a necessary service for cash-strapped Canadians who lack access to alternate sources of credit in times of need. It also generates a substantial economic footprint for the national economy in the process.
- In 2014, the licensed Canadian payday loan industry provided nearly 4.5 million short-term loans to Canadian households, at a total value of $2.2 billion.
- Despite its unfavourable reputation, the licensed payday loans industry provides a necessary service for cash-strapped Canadians.
- Placing stringent regulations on the industry may reduce access to credit for the financially vulnerable. Consumer education is advised to protect the financial welfare of borrowers and deter the growth of unregulated lending channels.