City plans to control payday lending industry
There are 70 payday lending institutions in Ottawa, and the city is eyeing long-term plans to develop regulations to control their spread.
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The city is taking the first steps required to control the payday lending industry in Ottawa.
As part of an omnibus amendment package, the Agricultural and Rural Affairs Committee approved separating payday lending institutions from banks in the zoning definitions.
Doing so is a necessary step before the city can develop regulations that specifically apply to payday lenders and not banks.
Planner Carol Ruddy said that controlling how close payday lenders can be to one another is the likely avenue that the city can take to limit their proliferation.
Since payday lenders tend to cluster in places with lower incomes, doing so will help protect vulnerable populations, and help improve low-income neighbourhoods.
There are 70 businesses offering payday loans in Ottawa. These businesses are often criticized for a lack of clarity when it comes to their exorbitant interest rates.
“I walk down Montreal Road and I can see them right there,” said Ray Noyes, a member of ACORN Ottawa. “When you’ve got a string of these payday lenders as part of your streetscape, it’s not good for the morale or the business.”
Ruddy said it won’t be until the next term of council that they will be able to begin to develop comprehensive regulations.