Know your obligations
The information on this page is to help you understand the payday lender law and ensure you maintain your good standing as a business. This is a general overview of our expectations and the laws we oversee. It is your responsibility as a BC-licensed payday lender to review the laws in detail, comply with municipal bylaw and get independent legal advice, if necessary.
As part of our inspection or investigative process, we may impose an administrative monetary penalty (financial penalty) for certain violations of the laws we oversee. Every contravention has a base penalty amount, based in part on the seriousness of the infraction.
Read the Business Practices and Consumer Protection Act.
Read the Payday Loans Regulations.
Understand all our policies, including about administrative penalties.
Report changes to your business
You must report any changes to your business within 14 days including a business name change, location change, changing partner or corporate officer, change in business model, or if you are selling your business.
Report aggregate loan data
Submit a standard payday loan agreement
You must submit a copy of a standard payday loan agreement which shows all charges for every transaction along with the terms & conditions.
Set up of charges and fee structure
You may charge up to 15% of the principal of the loan. This amount must include all fees and interest, except interest charge if the borrower defaults by not repaying the loan as agreed to in the loan agreement.
Display the rates you charge
Display your licence and licence number
You must publicly display your licence in your place of business. You must also include your licence number on any print or web materials, including:
- business cards
- print collaterals (such as brochures and flyers)
- documentations (including contracts)
- your website
If you are an online lender, your licence number must be at the top of the first page of the website.
Comply with cash card issuance policy
It is important to understand that a prepaid card provided, distributed or otherwise made available by a payday lender is a cash card and therefore has a direct impact on amounts charged, required or accepted for or in relation to cash cards issued by the payday lender.
Regardless of the overall cost of borrowing limit in BC of 15%, there is an outright prohibition on a payday lender charging, requiring, or accepting any amount related to the issuance of a cash card.
Understand what you can charge to cash government cheques
The most you can charge to cash a BC Employment and Assistance cheque is either $2.00 plus 1% of the cheque amount or $10 – whichever is less. This means that you can never charge more than $10 to cash these cheques.
As of September 15, 2019, this fee cap will also apply to all Ministry of Children and Family Development (MCFD) issued Imprest cheques. Imprest Account cheques are issued on demand.
The fee cap does not apply to manual printed cheques. These cheques are only issued in extreme circumstances. The payment details and signatures on these cheques are filled out in handwriting.
The BC Government is changing the look of the BC Employment and Assistance Imprest (on demand) cheques. The new cheques will be rolled out in a phased implementation from June through November 2019 across the province. Fee caps will apply to both the new and old cheques.
How can you tell if an Imprest cheque printed on the old stock is still valid & should have a fee cap?
- If the cheque is printed on old cheque stock but the date on the cheque is from the past six months or less, the cheque is valid and the government cheque cashing fee cap should be applied.
- If a cheque is printed on old cheque stock and the date on the cheque is six months plus a day or greater, the cheque is considered stale dated by the BC Government and the cheque is no longer considered valid. In this instance, the cheque cannot be cashed and the cheque cashing fee cap does not apply.
Need more information around which cheques have a fee cap and which don’t? Wondering what these cheques look like?
Comply with business practices
You must not engage in practices that encourage continued debt and dependence or other unfair practices. This includes the following:
- you may not issue more than one loan to a borrower at the same time.
- you may not roll over one loan into another loan with new charges.
- you may not issue a loan for more than 50% of the borrower’s paycheque or net income to be received during a single pay period within the payday loan term.
- If a borrower is taking their third loan in a two-month period, repayment of the loan must be phase over two or three pay periods.
- you may not require or request from a borrower any payment, whether to you as the payday lender or a third-party services provider, that in total exceeds a prescribed portion of the borrower’s net pay or other net income to be received during the payday loan term. (For additional context around maximum repayments, please review section 23 of the Payday Loan Regulation.)
You are also prohibited from selling insurance to or for a borrower or requiring/requesting that a borrower insure a payday loan.
Understand consumer rights
Your consumer has the right to change their mind and cancel the loan by the end of 2 days – without paying any charges. Your consumer can repay a loan any time before the due date and cannot be charged extra for doing this.
Understand our inspection process
We perform routine, random, follow-up, and complaint-based inspections on all our regulated businesses to ensure they comply with the law.
Do not engage in deceptive or unconscionable acts
By law, you must not engage in deceptive or unconscionable acts.
Read the Business Practices and Consumer Protection Act, section 4.
BC consumer protection laws require that businesses have a licence for each location from where it conducts business. Conducting business from a location means several things, including:
- A location from which your physical presence, address, or telephone number in British Columbia is given in a telephone directory.
- A location from which your physical presence, address, or telephone number in British Columbia is given in any verbal or written advertisement,
- You have, in British Columbia, a resident agent, or a warehouse, office, or place of business.
We understand that you may provide remote working options to your employees.
Provided they are not conducting business in the way described above, remote workers may work from remote locations if they follow these guidelines:
- They can only work remotely from their home-based location.
- If the law or health directives allow, they are only to directly meet and serve clients from licensed locations and not at remote or unlicensed home-based locations.
- While conducting business, they must only, use the contact information of the licensed location in any visual representation, correspondence, business cards, or on any printed or electronic advertisement.
- Other than cell phone numbers or corporate IP-based phone numbers, they may not disclose their personal telephone number(s) to suppliers or clients nor reveal that they are conducting business from any unlicensed location.
- Payments for services may be received only at the licensed office unless those payments are through electronic means via credit card or immediate EFT, and no payment information is retained or stored in the home-based location.
- All client files, arrangement details, and associated original records of accounting or contracts handled by a telecommuter must be kept at the businesses’ licensed location. (It is permissible for telecommuters to retain copies of routine correspondence and other records at their home-based location).
- Persons selling or otherwise arranging for the supply of goods and services to consumers with the expectation of receiving payment or benefit for so doing, are deemed to be acting as licensees and are required to comply with the provisions of these guidelines.
Except for items 6 and 7 above, these guidelines do not apply to employees of licensees performing purely accounting or other administrative functions.