What exactly is changing?

The monthly penalty interest that lenders can charge borrowers who default on their loans will be limited to 2.5 per cent under the new rules. This rate is non-compounding and determined in the principle that is outstanding. In addition, borrowers whom bounce cheques or have actually inadequate funds inside their banking account if the time for repayment comes can simply be charged a maximum $25 penalty cost. Loan providers can just only charge this cost as soon as, regardless of true quantity of times a repayment is dishonoured. The guidelines simply simply take impact Aug. 20, 2020, and cannot be reproduced retroactively to loans in presence before this date.

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