Payday loan companies may soon find it harder to set up shop in the city.
City council took steps towards restricting payday lender locations in Burnaby at Monday night’s meeting, after receiving a detailed staff report on the topic.
A delegation from the Burnaby branch of ACORN (Association of Community Organizations for Reform Now) Canada spoke to council in February 2014, asking that something be done to stop the exploitation of the poor by payday lenders. The issue was referred to the city’s planning and development committee.
“I think it was worth the wait because I think our staff have done a fabulous job of canvassing all of the issues around so-called payday loans,” Coun. Colleen Jordan, who heads the committee, said at the meeting.
Staff recommended that council authorize a bylaw amendment that would limit new payday loan locations to zoning districts in the city specifically for pawn shops and second-hand stores. Currently, they’re considered a bank under the zoning bylaw and are permitted in commercial and neighbourhood districts, where banks are.
The proposed amendment will eventually go to public hearing.
Current payday lenders that offer to buy gold must apply to be rezoned under the current bylaw as pawn shops or must close up shop, according to the report.
The report also recommended that council write B.C.’s minister of justice, advocating for increased regulation of the payday loan industry, and put forward a resolution advocating increased regulation to the Federation of Canadian Municipalities and the Union of B.C. Municipalities.
Council passed all the recommended motions at Monday night’s meeting.
ACORN’s Burnaby branch lauded the move.
“My understanding is that it’s going to be much more difficult for payday lenders to start operations in Burnaby in the future, and we at ACORN are good with that,” ACORN member Rick Erb told the NOW. “In our view, the payday lending operations put a great deal of pressure on lower and moderate income people.”
Payday loan stores in lower-income areas that offer high-interest, short-term loans have been an issue for a number of cities, with White Rock and Maple Ridge recently prohibiting such businesses.
There are eight payday loan locations in Burnaby, according to the staff report, with six located on Kingsway.
