More action needed for fair banking

So-called “alternative lenders” face new limits on how much interest they can charge borrowers following changes to the Criminal Code that came into effect with the New Year. Lenders could previously charge up to 60 per cent in “effective annual interest” for personal loans, which translates to roughly 47 per cent APR (annual percentage rate).

The newly implemented reforms reduce that limit to 35 per cent APR. It’s a victory for activists who campaigned for a reduced criminal rate of interest, but they’re calling on the federal government to take more action against predatory lending. For more on this story, the NB Media Co-op interviewed legal scholar Gail Henderson of Queen’s University — who wrote about the changes in a recent article for the Dalhousie Law Journal — and Donna Borden of ACORN Canada, a grassroots association of low-to-moderate income people, which campaigned for years for a lower criminal rate of interest.

These interviews were conducted by NB ACORN co-chair Peter Jongeneelen, who has personal experience dealing with high-interest loans. He also helped to organize rallies in Moncton at a local branch of Easyfinancial, which previously charged up to 46.96 per cent APR on installment loans. David Gordon Koch is a journalist with the NB Media Co-op. Peter Jongeneelen is co-chair of NB ACORN. This reporting has been made possible in part by the Government of Canada, administered by the Canadian Association of Community Television Stations and Users (CACTUS).

Read the full article on NB Media Co-op.