Yes.
Evidence of meeting #117 for Finance in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was ontario.
Evidence of meeting #117 for Finance in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was ontario.
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
Yes.
12:05 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
I believe that in your industry the high-cost credit is 32%.
Is that correct? What would you consider to be a high-cost credit?
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
That sounds about right.
12:05 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
I just got it off the Internet, so I think we're good.
For $15 for every $100 within the payday loan framework, it's 390% annualized interest for the most vulnerable people, unbanked people, people who, quite frankly, when your industry abandoned inner-city cores, had to turn to these because they couldn't cash things like the ODSP and Ontario Works.
What's your comment on that?
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
Canadians are well served by Canadian banks. About 99% of Canadians have a bank account, probably the highest percentage in the entire world.
12:05 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
That's not what I asked you. I asked you a very specific question.
Let's talk about the 1%, the people who have to turn to usury—what I would call “predatory lending” to be polite, and “parasitic lending” to be more accurate.
What do you say about the fact that people have to turn to predatory lending in order to cash their meagre social assistance cheques every single month?
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
Canadians are able to cash their cheques into their bank account and obtain their—
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
Yes, they can.
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
There are certain requirements, but those requirements are minimal.
12:05 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Are they minimal enough to exclude a certain percentage of the population?
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
No.
12:05 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Is it your assertion here at committee that people are choosing to go to a payday loan rather than cash their monthly cheque at, say, the Bank of Montreal or CIBC? There are no barriers at all. Is that your testimony here today?
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
Canadians are able to open a bank account, and cash their cheque at their bank.
12:05 p.m.
NDP
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
Maybe not having the right ID is one example.
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
It's what...?
12:05 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Would you call for higher regulations on the predatory payday loan industry?
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
That is something the government should look at.
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
Probably.
12:05 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Do any of the mainstream banks have any financial connections with any of the payday loan industries?
12:05 p.m.
Vice President and Head Economist, Financial Stability and Banking Policy, Canadian Bankers Association
I don't know. I can't comment on the financial dealings of our members.