Nova Scotia Legislation

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As a result of the federal government passing legislation allowing for payday loans in Canada to operate free of usury laws by the passing of CC 347.1, it has been up to individual provinces to regulate them.

In June 11, 2009 Nova Scotia's regulations for payday loans came into effect, fulfilling the requirements of the federal usury law's exemption for payday loans.  There have been two rounds of legislation, the first establishing these rules for payday loans in Nova Scotia:

• maximum interest of 31% of the principal
• maximum loan amount of 50% of the borrower's expected paycheque
• no rollovers
• only one loan allowed at a time
• loans may be cancelled without fee during a two day grace period
• clear disclosure of all fees

The second round followed from two recommendations from the board (here and here) which the minister accepted.  The recommendations ultimately had the following effects:

• reduced the maximum interest charged to 25%
• allowed for the regulation of online payday loans
• specifically including insurance costs as part of the interest charged

In a series of rapid-fire decisions from the NSURB, rates were reduced from 25% to 22% in 2018, and were further reduced from 22% to 19% effective February 2019, and were further reduced from 19% to 17% in 2022. Limits on overdue interest also changed in September 2022 to a maximum of 30%

Enforcement of the legislation is carried out by the Nova Scotia Utility and Review Board.  This is accomplished through mandatory licensing of all lenders, coupled with annual inspections.

Resources for payday loans in Nova Scotia:

• Payday Lenders Regulation
• Canadian Payday Loan Regulations
• Payday Loans Timeline