From next month, i.e. August 2009, there will be new rules for Nova Scotia payday lenders.

Nova Scotia Utility and Review Board had set a fee cap on payday loans last year – this will come in effect from next month onwards.

Here is the new rule:

Payday lenders in Nova Scotia cannot charge more than $31 per $100 borrowed, which includes all non-optional fees tied to the loan. Default fees cannot exceed $40 per loan; and the interest rate on loans in default cannot exceed 60 per cent annually.

Payday loan rates in Nova Scotia range from about $15 to $35 per $100, according to evidence submitted to the regulatory board.

If this isn’t enough, the rollovers are also banned.

Payday lenders will have to submit annual reports to the province every year.

The Utility and Review Board will also carry out a review of the regulations in 2010.