Cash Store Financial Services Inc. says it will request a hearing before Ontario’s Licence Appeal Tribunal in response to government pressure on its lending businesses.
The company says Ontario’s registrar for payday loans wants to revoke the payday lending licences of its Cash Store Inc. and Instaloans Inc. businesses.
However, Edmonton-based Cash Store Financial says it no longer offers payday loans in Ontario since introducing line of credit products.
Cash Store Financial says Ontario’s Ministry of Consumer Affairs has attempted since September, 2011, to force it to deliver payday loans in cash, rather than the electronic methods they now use.
The company says it’s unwilling to place employees and customers at risk by having them handling cash.
Ontario premier-designate Kathleen Wynne declined to comment on Cash Store, but said the Liberals brought in legislation to tighten up the rules.
“We brought in that legislation because there were vulnerabilties for people who were using those services and we want to make sure they are protected,” Ms. Wynne said Wednesday.
Cash Store Financial Services said the Consumer Affairs’ consumer protection branch has also attempted to stop the Cash Store Inc. and Instaloans Inc. from selling products other than payday loans.
“The companies have indicated that they are not prepared to accept these onerous restrictions,” Cash Store Financial Services said in a news release.
Also Wednesday, Cash Store Financial Services Inc. announced it swung to a loss in its first quarter mainly because of expenses associated with restating its results for the second and third quarters of fiscal 2012.
The lender says it had a net loss of $1.7-million, or 9 cents per diluted share, compared to net income of $989,000, or 6 cents per share, in the year earlier period.
However, revenue for the fiscal first quarter came in at $49.5-million, up from $45.8-million year over year. Loan volume was also up at $203.5-million compared to $199.6-million in the year-earlier period.Report Typo/Error