Definitions

112.16   In this Part:

"advance" has the same meaning as in Part 5;

"APR" has the same meaning as in Part 5;

"assignment of wages" has the same meaning as in Part 6.1;

"borrower" has the same meaning as in Part 5, and, for greater certainty, includes a lessee;

"cash card" means a card or other device that

(a) can be used to obtain cash or acquire goods or services, but does not include a credit card, and

(b) is issued by a high-cost credit grantor to the borrower of a high-cost credit product instead of advancing cash or transferring money to the borrower or to the order of the borrower;

"default charge" has the same meaning as in Part 5;

"fixed credit" has the same meaning as in Part 5;

"grace period" has the same meaning as in Part 5;

"high-cost credit agreement" means a credit agreement under which credit is extended by way of a high-cost credit product, and includes an agreement to renew, amend or extend a high-cost credit agreement;

"high-cost credit grantor" means a person who offers, arranges, provides or facilitates high-cost credit products to or for consumers, and, for greater certainty, includes a loan broker;

"high-cost credit product" means

(a) a fixed credit product that has an APR that exceeds the prescribed APR and meets other prescribed criteria,

(b) an open credit product that has an annual interest rate that, calculated in accordance with the regulations, exceeds the prescribed annual interest rate and meets other prescribed criteria,

(c) a lease that has an APR that exceeds the prescribed APR and meets other prescribed criteria, or

(d) a prescribed product through which credit is extended by a high-cost credit grantor to a borrower primarily for a personal, family or household purpose,

but does not include a payday loan, mortgage on real property or prescribed credit product;

"interest" has the same meaning as in Part 5;

"loan broker" has the same meaning as in Part 5;

"open credit" has the same meaning as in Part 5;

"optional product" means a good or service, or both, that is offered to a borrower in connection with a high-cost credit agreement and that the borrower does not have to accept in order to enter into the high-cost credit agreement;

"outstanding balance" has the same meaning as in Part 5;

"payment" has the same meaning as in Part 5;

"personal information" has the same meaning as in section 1 of the Personal Information Protection Act;

"security interest" has the same meaning as in Part 5;

"term" has the same meaning as in Part 5;

"third party service provider charge" means any fee, penalty, rate, commission, consideration, charge or other amount that is charged or required by a person who is not the high-cost credit grantor, or that is paid to such a person, in relation to a high-cost credit product;

"total cost of credit" has the same meaning as in Part 5.

Limits on total cost of borrowing — high-cost credit products

112.17   A high-cost credit grantor must not charge a borrower a rate that is equal to or higher than

(a) a prescribed rate, if any, or

(b) if there is no prescribed rate, the rate in section 347 of the Criminal Code (Canada).

Certain fees, penalties and charges prohibited

112.18   A high-cost credit grantor must not charge, require or accept

(a) any amount that is not disclosed in the high-cost credit agreement,

(b) any amount that exceeds the amount disclosed in the high-cost credit agreement,

(c) any amount for cancellation of a high-cost credit product under section 112.20 [high-cost credit product cancellation rights],

(d) any amount for making a payment before it is due under the high-cost credit agreement or for repayment of a high-cost credit product before the end of the term of the high-cost credit agreement,

(e) any fee to refinance, restructure or change the terms of a high-cost credit agreement, or

(f) any other prescribed fee, penalty, rate, commission, consideration, charge or other amount.

No deduction from principal

112.19   A high-cost credit grantor must not

(a) discount the principal amount of a high-cost credit product by deducting or withholding an amount from any advance, or

(b) draw an amount representing any portion of the total cost of credit.

High-cost credit product cancellation rights

112.20   (1) A borrower may cancel a high-cost credit product at any time before the end of the next day that the high-cost credit grantor is open for business following the date on which the borrower enters into the agreement, or before the end of any longer period that may be prescribed in the regulations.

(1.1) If the next day that the high-cost credit grantor is open for business following the date on which the borrower enters into the agreement falls on a holiday, or if the longer period referred to in subsection (1) expires on a holiday, the time for exercising the cancellation right under subsection (1) is extended to the end of the next day that the high-cost credit grantor is open for business that is not a holiday.

(2) A borrower may cancel a high-cost credit product at any time if the high-cost credit grantor

(a) does not advise the borrower of the borrower's cancellation right under subsection (1),

(b) fails to satisfy any of the requirements of section 112.21 (2), (4) (a) and (5) [high-cost credit agreements: required terms], or

(c) contravenes a prescribed provision of this Act or the regulations.

(3) To exercise cancellation rights under this section, the borrower must

(a) complete the cancellation notice provided by the high-cost credit grantor under section 112.21 (5) and give that notice to the high-cost credit grantor in accordance with the regulations, and

(b) repay, by cash, certified cheque or money order or in another prescribed manner, the outstanding balance of all amounts advanced to the borrower under the high-cost credit agreement less any amount of the cost of credit that was, as of the date of cancellation, repaid by or on behalf of the borrower.

(4) For the purpose of subsection (3) (b),

(a) if the first advance was made in the form of a cheque, a return of the unnegotiated cheque to the high-cost credit grantor is to be considered a repayment of that advance,

(b) if the first advance was made in the form of a cash card, a return of that cash card to the high-cost credit grantor is to be considered a repayment of the first advance to the extent of the outstanding balance remaining on the cash card, and

(c) receipt of a cash card constitutes an advance if the cash card is in immediate effect on that receipt and can be used by the borrower to obtain cash or acquire goods or services at that time.

(5) [Repealed 2021-27-36.]

(6) On the cancellation of a high-cost credit product under this section, the high-cost credit grantor must immediately give the borrower a receipt for the amount the borrower repaid or returned to the high-cost credit grantor.

(7) Cancellation of a high-cost credit product under this section extinguishes every liability and obligation of the borrower under or related to the high-cost credit agreement.

High-cost credit agreements: required terms

112.21   (1) The terms of a high-cost credit product must be included in a written high-cost credit agreement that is signed and dated by the borrower.

(2) A high-cost credit grantor must ensure that the high-cost credit agreement includes all of the following terms, information and statements:

(a) the high-cost credit grantor's

(i) name and, if different, the name under which the high-cost credit grantor carries on business,

(ii) business address and, if different, the high-cost credit grantor's mailing address, and

(iii) licence number, telephone number and, if the high-cost credit grantor has a fax number or email address, that fax number or email address;

(b) the borrower's name;

(c) the date of the agreement and, if known, the date or dates on which the first advance and any other advance will be made to the borrower or to the order of the borrower;

(d) a statement that the high-cost credit product is high-cost credit;

(e) a statement of the type of high-cost credit product;

(f) the principal amount of the high-cost credit product or the amount of funds available, as applicable;

(g) the term of the high-cost credit product and, if applicable, the date on which each payment is due to the high-cost credit grantor and the amount of each of those payments;

(h) respecting access to the high-cost credit product,

(i) each method by which the borrower may access funds for each transfer or advance,

(ii) if applicable, the date or dates on which the first and any other transfers or advances to the borrower will be made,

(iii) if applicable, the amount of any funds transferred or advanced, on each transfer or advance, to the borrower, and

(iv) if applicable, the cost of each method of accessing the funds on each transfer or advance;

(i) if the high-cost credit grantor advances or transfers the funds to the borrower by means of a cash card,

(i) the date and time the cash card is issued to the borrower,

(ii) the amount of credit available on the cash card issued to the borrower,

(iii) a statement that third party service provider charges may apply for use of the card, and

(iv) if applicable, the expiry date of the cash card;

(j) the fee, penalty, commission, consideration, charge or other amount subject to interest, the interest rate, how interest is calculated and compounded, how, when and why the interest rate will or may change, and a statement of the total amount of interest that is payable on the high-cost credit product and of what is included in the calculation of that amount;

(k) [Not in force.]

(l) the annual interest rate and, if applicable, the APR;

(m) as applicable,

(i) the total cost of credit expressed as a dollar amount, or

(ii) the total cost of credit expressed as a dollar amount based on the maximum available if the high-cost credit product is repaid within the prescribed time period;

(n) the fee, penalty, commission, consideration, charge or other amount that will or may be payable by or on behalf of the borrower to the high-cost credit grantor or a third party service provider;

(o) how, how often and why the fee, penalty, commission, consideration, charge or other amount referred to in paragraph (n) will or may be payable and what will or may happen if the borrower fails to pay a fee, penalty, commission, consideration, charge or other amount;

(p) how each payment will be applied to the accumulated cost of credit and the principal;

(q) the borrower's right to make full or partial prepayment under section 112.25 [entitlement to prepay and receipts for payments], and how to exercise that right;

(r) any security interest that will or may be required from the borrower;

(s) any grace period that will or may apply and what conditions, if any, the borrower must meet to benefit from it;

(t) what will or may happen if the borrower fails to make a payment when it becomes due, including

(i) what default charges or penalties will or may be payable by the borrower,

(ii) how and when the terms and conditions of the high-cost credit agreement will or may be affected by the missed payment, and

(iii) what will or may happen to any collateral or security;

(u) how, when and in what circumstances the high-cost credit grantor will or may demand payment in full from the borrower;

(v) each good or service that must also be purchased by the borrower, how to purchase it, why it is required and how much it will cost;

(w) the nature, amount and timing of payments for any optional product purchased by the borrower for which payments are to be made to or through the high-cost credit grantor;

(x) the conditions under which the borrower may terminate an optional product referred to in paragraph (w);

(y) how, when and in what circumstances the high-cost credit grantor will or may cancel the high-cost credit agreement;

(z) a statement of the borrower's rights of cancellation under section 112.20 [high-cost credit product cancellation rights], including how those rights can be exercised and identifying the date by which the borrower can exercise them;

(z.1) a statement of the remedies available to the borrower under section 112.31 [remedies];

(z.2) any other term, information or statement that may be prescribed in the regulations.

(3) The high-cost credit grantor must ensure that the terms, information and statements required under subsection (2) are written in a clear and comprehensible manner and meet any other prescribed criteria.

(4) Before the borrower signs a high-cost credit agreement, the high-cost credit grantor must

(a) review with the borrower the prescribed matters, and

(b) require that the borrower initial each of those matters in the agreement.

(5) The high-cost credit grantor must give the borrower a copy of the high-cost credit agreement at the time it is signed by the borrower, together with

(a) a cancellation notice in the form approved by the director, which may be used by the borrower for the purposes of section 112.20, and

(b) any other prescribed documents.

(6) The borrower may request, orally or in writing, an additional copy of the high-cost credit agreement.

(7) The high-cost credit grantor must provide the requested additional copy to the borrower within one business day of receiving the request under subsection (6).

Enticements prohibited

112.22   A high-cost credit grantor must not

(a) offer or promise to give, directly or indirectly, any prize or reward as an incentive to enter into, or for having entered into, a high-cost credit agreement, or

(b) state or imply that a high-cost credit product will improve the borrower's credit rating if it will not do so.

Assignment of wages prohibited

112.23   (1) A high-cost credit grantor must not require, request or accept an assignment of wages from the borrower.

(2) An assignment of wages is not valid if it is given in consideration of a high-cost credit product or an advance under a high-cost credit product, or to secure or facilitate a payment in relation to a high-cost credit product.

Payment must be payable to high-cost credit grantor

112.24   A high-cost credit grantor must not require, request or accept a cheque, pre-authorized debit or other negotiable instrument from a borrower unless the instrument

(a) is made payable to the high-cost credit grantor directly, and

(b) states the frequency of payments to be made to the high-cost credit grantor.

Entitlement to prepay and receipts for payments

112.25   (1) The borrower is entitled to prepay to the high-cost credit grantor, at any time,

(a) the full outstanding balance owing under the high-cost credit agreement, and

(b) any amount, whether full or partial, before it is due under the high-cost credit agreement.

(2) On receiving payment, the high-cost credit grantor must immediately give the borrower a receipt for that payment, and that receipt must include the information prescribed by regulation.

Early payment collection prohibited

112.26   A high-cost credit grantor must not collect or attempt to collect a payment before the date that payment is due under the high-cost credit agreement.

Repeated attempts by high-cost credit grantor to access payment prohibited

112.27   (1) Subject to subsection (2), a high-cost credit grantor must not present, more than once, a cheque, pre-authorized debit or other negotiable instrument provided by the borrower in exchange for regularly scheduled payments, or initiate, more than once, an electronic funds transfer, for the purpose of processing a regularly scheduled payment.

(2) If a high-cost credit grantor attempts to process a regularly scheduled payment and the payment is dishonoured, the high-cost credit grantor may make one additional attempt to process the payment by presenting a cheque, pre-authorized debit or other negotiable instrument or initiating an electronic funds transfer, as referred to in subsection (1), if

(a) the additional attempt to process the payment is for the same payment amount as the first attempt, and

(b) the additional attempt to process the payment is made within 30 days after the high-cost credit grantor received notice that the first payment was dishonoured.

Use of bank account information restricted

112.28   (1) Subject to subsection (2), a high-cost credit grantor must not require, request or accept information that would give the high-cost credit grantor direct access to a borrower's bank account.

(2) Subsection (1) does not apply to information in a pre-authorized debit for repayment of a high-cost credit product.

(3) If a borrower provides a high-cost credit grantor a pre-authorized debit in exchange for the advance of funds under a high-cost credit agreement, the high-cost credit grantor must not use that information for any purpose other than to access the borrower's account to process the pre-authorized payment.

Use and disclosure of borrower information restricted

112.29   A high-cost credit grantor must not require, request or accept consent from a borrower of a high-cost credit product to use or disclose the borrower's personal information for a purpose other than offering, arranging, providing, insuring or facilitating a high-cost credit product.

Payout of balances on cash cards

112.30   (1) If, in respect of a high-cost credit product, the high-cost credit grantor issues a cash card to the borrower, the borrower is entitled to be paid in cash the amount of the balance of credit remaining on the card in either of the following circumstances:

(a) the balance of credit remaining on the cash card is less than the prescribed amount;

(b) the high-cost credit product has been repaid by the borrower and the cash card has expired.

(2) If the borrower is entitled to be paid a balance under subsection (1) and the borrower returns the cash card to the high-cost credit grantor, the high-cost credit grantor must pay the balance immediately on demand by the borrower or by the director.

(3) On return of a cash card under this section, the high-cost credit grantor must immediately give the borrower a receipt for the cash card, and the receipt must specify the amount paid to the borrower.

(4) Subject to and in accordance with the regulations, the balance of credit remaining on an expired cash card issued to a delinquent borrower may be applied by the high-cost credit grantor as payment towards the high-cost credit product.

(5) In subsection (4), "delinquent borrower" means a borrower who fails to repay a high-cost credit product by the end of the high-cost credit product term under the high-cost credit agreement.

Remedies

112.31   (1) The borrower is not liable to pay the high-cost credit grantor any amount that

(a) exceeds the maximum under section 112.17 [limits on total cost of borrowing — high-cost credit products], or

(b) a high-cost credit grantor is prohibited from charging, requiring or accepting under section 112.18 [certain fees, penalties and charges prohibited].

(2) If the borrower has paid an amount referred to in subsection (1), the borrower

(a) is liable only to repay the principal of the high-cost credit product, and

(b) is entitled to a refund of all monies paid in excess of the principal of the high-cost credit product.

(3) If a high-cost credit grantor contravenes section 112.19 [no deduction from principal] by deducting a portion of the total cost of credit from the first advance, the borrower is not liable to repay the high-cost credit grantor any amount that exceeds the advance less the portion deducted.

(4) If the borrower has paid an amount that exceeds the amount of the advance less the portion deducted referred to in subsection (3), the borrower

(a) is liable to repay the high-cost credit grantor only an amount equal to the advance less the portion deducted, and

(b) is entitled to a refund of any amount that exceeds the amount of the advance less the portion deducted.

(5) If the borrower is entitled to a refund under subsection (2), (3) or (4), the high-cost credit grantor must provide the refund immediately on demand by the borrower or by the director.

(6) The remedies under this section are in addition to any other remedy available to the borrower and are additional to any other penalty that the high-cost credit grantor may be subject to under this Act or the regulations.

Exceptions

112.32   Except to the extent provided by the regulations, this Part does not apply to

(a) savings institutions that offer, arrange or provide high-cost credit products, or

(b) prescribed classes of high-cost credit grantors.

Application

112.33   If there is a conflict or inconsistency between provisions in Part 5 and provisions in this Part that apply to a borrower or a high-cost credit grantor, the provision that is most beneficial to the borrower applies.