2025-2027 Fee review: high cost credit grantors

Consumer Protection BC is undergoing a fee review for all licensed sectors. The last review for all our other licensed sectors was in 2021.

As part of the process, Consumer Protection BC is providing an opportunity for all licensed high-cost credit grantors in BC to understand the proposed fee changes and provide feedback. This process closes on August 21, 2024. Consumer Protection BC will give 90-days’ notice prior to the fee changes taking effect.

The information below includes an overview of the fee setting process, how the fees are used, and how to provide feedback on the fee review process.

Information about your fees

Authority to set fees & mandate to recover costs

The Business Practices and Consumer Protection Authority Act provides Consumer Protection BC with the legal authority to set fees to fund operations and capital expenditures. Consumer Protection BC operates as a cost-recovery business, and therefore reviews and sets fees as needed to ensure that revenues match costs across all the regulated sectors. For each of the sectors that are regulated and licensed, Consumer Protection BC has the authority to set licensing fees and other charges. For reference, this authority can be found in the Fee Setting Criteria Regulation under the Business Practices and Consumer Protection Act, the Cremation, Interment and Funeral Services Act, and the Motion Picture Act. Consumer Protection BC’s regulatory model is unique in that it provides the opportunity to create economies of scale, ensure consistency across all licensed sectors and avoid cross-subsidization.

What is happening?

Consumer Protection BC is in the process of setting fees for 2025-2027. Following a review of costs and forecasted revenues for the next three years, below is a listing of the proposed changes for all licensing and administrative fees for this sector.

High-cost credit grantors

Fee typeCurrent feeProposed fees
Jan. 1, 2025
Proposed fees
Jan. 1, 2026
Proposed fees
Jan. 1, 2027
New principal location $5,412$6,061$6,667$7,067
New branch$2,229$2,496$2,746$2,911
Renewal principal location more than 2 weeks prior to expiry$5,412$6,061$6,667$7,067
Renewal principal location less than 2 weeks prior to expiry$5,412$6,136$6,750$7,155
Renewal branch more than 2 weeks prior to expiry$2,229$2,496$2,746$2,911
Renewal branch less than 2 weeks prior to expiry$2,229$2,571$2,828$2,998
New and renewal principal and branch Consumer Financial Education Fund (CFEF) contribution$200$224$246$261
Change of name or address$61$75$75$75
Change of directors/officers$66$75$75$75
NSF payment$63$50$50$50
Reconsideration$283$311$330$343

Why are fees changing?

Licensing fees pay for the direct costs of regulating the sector: licensing, compliance inspections, complaint handling and enforcement activities; and indirect costs of managing the sector: information technology, finance and accounting, and office rent. The indirect cost such as rent, and administrative costs are spread proportionately across each licensed sector. Every year these costs increase; sometimes consistent with inflation, in other cases based on unique factors related to a sector (ex. changes to the law that result in new regulatory requirements).

The costs for regulating the high-cost credit grantors sector have been affected primarily by inflation and an information on the actual cost of providing regulation to this sector since 2022. Licensing fees for the high-cost credit granting sector were set in regulation when first implemented in 2022. This is the first fee review and fee change proposed for the sector. In the intervening years Consumer Protection BC has made every effort to reduce costs while maintaining the ability to operate, with the intent of providing as much relief to licensed businesses as possible during unfavourable economic times. The proposed fee changes will ensure that Consumer Protection BC can operate effectively and that costs are accurately recovered for regulating this sector.

A new structure for renewing your licence

We are aligning the high-cost credit grantor sector with our other licensed sectors by implementing a new structure for licence renewal fees, effective January 1, 2025.  You will pay a lower fee if you renew your licence at least two (2) weeks before it expires. High-cost credit grantor licences expire on October 31 each year. This means you will pay less if you renew your licence at least two (2) weeks before October 31, starting with 2025 licence renewals. If you don’t renew your licence by its expiry date you will need to submit a new licence application. The purpose of these changes is to encourage our licensed businesses to submit their renewals on time and early. This creates efficiencies in the processing of renewals.

How are fees determined?

Consumer Protection BC operates on a cost recovery basis. No funding from the province of British Columbia is received, the organization is entirely self-funded. This means that the costs to license and regulate eight different sectors and provide trade practice oversight are primarily covered by licensing fees.

In setting these fees costs are allocated to each licensed sector using several factors to determine the share of the operating costs. The factors that determine a sector’s share of costs are broken down by the primary functions of the organization. Indirect cost such as rent, and administrative costs are spread proportionately across each licensed sector. Once these costs are determined for each licensed sector, fees are developed so that projected revenues from each sector closely match the costs to regulate each sector.

Organizational functionCost allocation method
LicensingBased on the number of active licences and the average time to process a licence.
Complaint handling and inquiriesBased on the average number of annual complaints and inquiries for each sector, and the complexity of those complaints.
Compliance and enforcementBased on the number of inspections for the previous three years and the average time to complete an inspection.
Business practicesBased on the average time spent for each licenced sector.
Administration costs (education & awareness, sector relations, policy & research, finance, etc.)The costs for administration are allocated to each sector proportionally based on each department’s headcount that the administrative costs support.
Trade practices (oversight of prepaid purchase cards, consumer contracts, other areas for which there is no direct licensing revenue and are included in the authority of Consumer Protection BC)The costs for trade practices are allocated to each sector proportionally based on the share of revenue generated from the sector.

 What do the fees pay for?

The high-cost credit grantors fees pay for the licensing and regulation of this specific sector.

A description of our approach to licensing, complaint handling, inspections and an overview of our enforcement tools.

What is the breakdown of fees for the high-cost credit grantors sector?

The Consumer Protection BC business model leverages economies of scale. Vital administrative functions are included in the allocation model along with the operational areas like Licensing, Inquiry, Compliance, Enforcement, Business Practices, and Trade Practices. All costs are managed to meet the cost-recovery mandate.

Costs related to this sector are divided by activity as follows:

Licensing14.2%
Inquiry4.3%
Compliance47.9%
Enforcement15.9%
Business Practices5.5%
Trade Practices12.3%

How to provide feedback

To sustain and improve the oversight of the sector and recover costs, Consumer Protection BC is requesting feedback to ensure that licensees understand the process of fee setting for the proposed fee changes for 2025 – 2027. To share any feedback on the fee review process, please take this survey.

The deadline to provide feedback is August 21, 2024.

take the survey

What happens next?

Once the survey closes and all the feedback has been reviewed, 90 days’ notice will be given prior to the implementation of any fee changes.