Nova Scotia's Utility and Review Board has set a limit on what payday loan companies can charge – $31 dollars on $100, including all expenses and interest.
The regulatory agency released a 105-page report Thursday after holding hearings and reviewing consumer-protection policies.
The board said that the maximum penalty for defaulting on a payday loan should be $40 and that the maximum interest rate on any outstanding balance can be no higher than 60 per cent.
The board says it is satisfied the Consumer Protection Act provides for full disclosure regarding all costs.
It recommended that the government draft regulations requiring lenders to file yearly reports on the number and size of loans provided as well as the number of defaults.
It also recommended that prospective borrowers not be forced to disclose personal financial information when trying to determine the cost of a loan.
