Payday Loans Business Licence
Definitions
A Payday Lender:
- Offers, arranges or provides a payday loan to a borrower in Alberta
- Operates from business premises or on the Internet
A Payday Loan means:
- any advancement of money with a principal of $1,500 or less and a term of 62 days or less made in exchange for a post-dated cheque, a pre-authorized debit or a future payment of a similar nature, but not for any guarantee, suretyship, overdraft protection or security on property and not through a margin loan, pawnbrokering, a line of credit or a credit card.
Licensing Requirements
Note: Failure to provide complete information will delay processing of your application and may result in a refund of your fees and closure of your file.
To get a licence as a Payday Loan business you must provide the following:
- Completed application form (pdf)
- Completed Addendum for Payday Loans form (pdf)
- Completed Statutory Declaration (pdf) for licensees who use independent contractors
- Security in the required amount will not be required until January 31, 2010. Requirements will be updated when more information is available.
- Payment of the License Fee:
Licenses may be obtained for either one or two year terms
For one year licenses - a licensing fee of $1000 for a licence and the first location plus $500 for each additional location specified on the application For two year licenses - a licensing fee of $2000 for a licence and the first location plus $1,000 for each additional location specified on the application
(Note: Your cheque should be made payable to the Minister of Finance. If you are applying in person, you can also pay this fee using Debit, Visa, MasterCard, or cash.)
Licences take effect the date they are issued. The department will send you a notice and the appropriate form(s) before your licence needs to be renewed. Licence holders must notify Service Alberta in writing if their business licence address changes.
- A copy of the business’ standard loan agreement
- A copy of the Cancellation Notice form
- A copy of the form used to acknowledge the receipt of the loan cancellation
- A copy of the form used to acknowledge receipt of payments made by the borrower
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A copy of the sign required under Section 20. The sign shall consist of only the following information in the following order:
- The words “We charge ________”, representing total charges for a payday loan
- The words “For a $300 loan for 14 days: Total cost of borrowing = __________” (representing the total charges for a $300 loan for 14 days)
- The words “Annual Percentage Rate = _________” (representing the annual percentage rate charged by the payday lender for a $300 loan for 14 days)
- The words “This information meets the requirements of the Payday Loans Regulation under the Fair Trading Act”
- Payday Loans Business Licence number
General Information
A business must have a licence and must prominently display a copy of the licence in each location named to which the licence pertains. If a business operates on the Internet, a copy of the license must be displayed prominently at or near the top of the introductory page of the website for Alberta borrowers.
Loan Agreement Requirements
Written loan agreements will be required. The agreements must conform with the requirements set out in the Cost of Credit Disclosure Regulation under the Fair Trading Act.
Receipt for Payment
Written receipts for payment will be required. The receipts must include the following information:
Name of the borrower
Date of payment
Agreement number of the payday loan on which the payment was made
Amount paid
Amount still owing on the payday loan, if any
Legislation
Fair Trading ActCost of Credit Disclosure Regulation
Copies of legislation can be obtained from the Queen’s Printer Bookstore at:
Park Plaza, 5 floor
10611-98 Avenue
Edmonton, Alberta
T5K 2P7
Phone: 780-427-4952
To call a Government of Alberta office toll-free (in Alberta), dial 310-0000 and follow the instructions.
