Payday Loans around the World – Chapter 11
- 23% of people in Saskatchewan borrow payday loans because they have no other source of borrowing
- Laws pertaining to payday loans only apply if you are currently in Saskatchewan
Basic Information about Payday Loans in Saskatchewan
Payday lenders in Saskatchewan are regulated and licensed by the Financial and Consumer Affairs Authority to offer, arrange or give pay day loans in Saskatchewan. Lenders must follow the rules in the The Payday Loans Act and regulations in order to get, keep or renew a license.
- Lenders are allowed to charge up to $23 for every $100 that they lend, which means a payday loan of $300 can cost $369 and it will be debited on your next payday.
- If you borrow $300 from a payday lender 5 times throughout the year, you will have paid a total of $345 ($69 x 5) in fees and interest costs.
- Maximum loan amount is $1,500 or 50% of net pay
Payday Loan Industry and Market research in Saskatchewan
The following report, “Short-Term Gain, Long-Term Pain: Examining the Growing Payday Loan Industry in B.C.” relays the following information about payday loans in Saskatchewan:
The rate of borrowing in Saskatchewan is 5.42%. The table below present the total number of borrowers who used payday loan in 2014, compared to the total population of Saskatchewan.
Total number of borrowers
Total adult population of province
Rate of borrowing
Payday Loan Customer Characteristics
According to the Annual Report 2013/2014 by the FCAA of Saskatchewan, we can learn the following about the payday loan borrowers in Saskatchewan:
Average age (yrs.)
Income > $50,000
Completed post-secondary education
The report also showed that the most common reasons that borrowers chose payday loans were: Quick and easy process (66%), convenient location (20%), no alternative source for borrowing (23%), structure forces me to pay back more quickly (5%) and less expensive than other forms of credit 4%. Only 40% of borrowers were aware of the payday loans regulations.
Competition in the Payday Loan Market in Saskatchewan
While screening the competition, we came across a List of Licensed Payday Lenders who were authorised by the Financial and Consumer Affairs Authority. Below is an overview of the list with the business names of the licensed payday lenders:
- Saskatchewan Ltd. – This company trades as “Yorkton Pawn” and offers payday loan advances from its registered address at 273 Myrtle Ave, Yorkton, SK, S3N1R5.
- Cash Mate Financial – A Canadian company that has been on the market for over 25 years. The company operates from its Cash 4 All office (303 33rd St, Saskatoon, SK, S7L0V3). Interestingly, they are online lenders and don’t have their own store.
- CNU Dollars Direct Inc. – Known as “Dollars Direct”, this company is a member of the Canadian Payday Loan Association. The maximum loan amount for first time customers is $500, and up to $1500 for approved returning customers. The maximum charges permitted are 23%. For example: For a $300 loan for 14 days, the total cost of borrowing is $69.00. The annual percentage rate is 599.64%.
- Cash Money Cheque Cashing Inc. – Known as “Cash Money” on the market, this lender has been around since 1992. They have more than 595,850 short-term cash borrowers and their loan fee is 23%, the NSF charge is $50 and default interest is 30% per annum. The maximum loan amount is $1500. In Saskatchewan, they have 7 locations in: 2 in Regina, 3 in Saskatoon, 1 in Prince Albert and 1 in Wichita.
- CashCo PDL Inc. – This company is a privately held Canadian company with headquarters in Edmonton Alberta and 62 locations across BC, Alberta, Ontario, and Saskatchewan. In Saskatchewan, they have 6 locations: 3 in Saskatoon and one in North Battleford, Regina and Prince Albert. The brand was born in 2014 when 4 different lenders with over 50 years of industry experience joined.
- Cross Canada Financial Inc. – Known as “Red Leaf Loans” is a licensed lender from whom you can get up to $1500. For each $100.00 you borrow, you will pay a fee as low as $22.98. The Annual percentage rate is 599.12%.
- Direct Credit 567 Inc. – Known as “310 LOAN”, this corporation is one of the first companies to provide online payday loans and cash advances in Canada. Born in 1999, the loan fee they charge is 23%, so the repayment amount on $100 would be $123 for 14-days. There is $50 fee if the borrower cannot repay the entire loan before the due date.
- Loan Express Corporation – This lender has been providing online payday loans across Canada for close to 10 years. For a principal of $300, the total cost of borrowing is $69 and the total to pay is $369. The fee is $23 for every $100 borrowed. There is a $50 fee if the borrower does not repay the entire loan before the due date.
- National Money Mart Company – Money Mart began as an entrepreneurial venture in 1982 and it is a founding member of the Canadian Payday Loan Association. Since 1994 till now they have over 500 branches across Canada. In Saskatchewan, they have 28 locations: Saskatoon 9, Regina 8, Prince Albert 3, Yorkton, Swift Current, Melfort, Meadow Lake, Moose Jaw, North Battleford, Estevan and Victoria. For a loan amount of $200, the fee is $46 and the total amount to repay is $246. The maximum loan amount you can get from Money Mart is $1500.
- Skeena Financial Services Ltd. – Operating under the brand ““Speedy Cash Payroll Advances””, Speedy Cash has been a strong leader in the financial services industry since 1998. They are members of the Canadian Payday Loan Association and you can borrow up to $1500. They have 6 branches in Saskatchewan: Moose Jaw, North Battleford, Prince Albert, Regina, Street West and Yorkton.
- The Money Shack Ltd. – This is an online broker rather than a direct lender. There are no line-ups and no credit check and you can borrow up to $1500 under simple repayment terms with The Money Shack.
- Westrock Financial Ltd. – This company trades as “MyCandadaPayday.com”. It is a Canadian business and is a fully licensed Payday Lender in British Columbia, Alberta, Nova Scotia, Saskatchewan and Ontario. Westrock Financial also provides cheque cashing services in their Surrey location.
The consumers council in Canada published a report called “Consumer Experiences in Online Pay day Loans” (2015). In it, there is a list of online payday loan sites audited by province. Because some of them are left out, we have just added information to those who were not listed but do exist. For Saskatchewan, there are 8 companies:
- Able to get up to $500.
- Maximum charges permitted is 23%.
- For a $300 loan for 14 days: Total cost of borrowing is $69.00.
- Annual Percentage Rate is 599.64%.
- $23.00 per $100 borrowed.
- Provides fast and easy payday loans.
- Saskatchewan License #100055
- Loan application online, with approvals in as little as 15 minutes.
- SSL Encrypted data transfer.
- EFT – Your chequing account.
The third source is the Yellow pages Canada where there are 43 stores for ‘Payday Loan Services’ listed surrounding Saskatchewan. The highest rated company is Speedy Cash Payday Advances located in Moose Jaw, and next is CashMoney located in Prince Albert.
Regulations on Payday loans in Saskatchewan
Payday lenders are regulated and licensed by the Financial and Consumer Affairs Authority. Lenders must follow the rules in The Payday Loans Act and regulations in order to get, keep or renew a license in Saskatchewan.
- The Saskatchewan government has set a maximum fee of 23 per cent of the principal or $23 per $100 loaned.
- Payday loans are limited to half (50%) of your take-home pay and only one loan is allowed at a time.
- The regulations require payday loan operations to be licensed at a cost of $2,000 per location while payday loan agreements are required to be in writing and provided to customers.
Charging additional fees beyond the allowed interest rate, charging fees to repay the loan before its due date and lending more than 50% of the borrower’s net pay during the term of the loan are prohibited.
Loans are payable on or after the next regular pay date. Loan agreements must be in writing, dated and signed by the borrower. Borrowers should receive and keep a copy of all payday loan agreements and associated documents, including pre-authorized debit agreements.
Payday lenders can only enter into one pre-authorized debit (PAD). The payday lender can only retry the PAD one more time after which the lender needs to obtain repayment through another method such as cheque, direct debit or email money transfer. The additional PAD retry must be made within 30 days after the payday lender received notice that the initial attempt was not successful. Also, the payday lender may only charge the borrower one NSF charge per loan agreement, no matter how many cheques or pre-authorized debits were dishonoured.
The Payday Loans Act of Saskatchewan applies to payday loans offered to anyone in Saskatchewan. Generally, the Act applies to a payday loan if:
- You take the loan at a lender’s physical storefront location anywhere in Saskatchewan.
- You borrow a loan on the internet while you are anywhere in Saskatchewan.
- You enter the loan agreement over the phone or by fax while you are anywhere in Saskatchewan.
The Act will not apply to your payday loan if you are outside of Saskatchewan when you enter the payday loan agreement.