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Ontario to review its Payday Loans Act in response to new technologies

Participants work on a smartphone and laptop computer in between conferences on the first day of the re:publica 2013 conferences on May 6, 2013 in Berlin, Germany. Sean Gallup/Getty Images

TORONTO – The provincial government says it will launch a review of the Payday Loans Act, adopted in 2008 to better protect customers.

The review is in response to technological changes in the payday loan industry.

They include the growth of online transactions, smartphone-enabled loan approvals and new forms of high-cost, short-term loans.

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The review will also explore ways to track payday loans and ensure companies are compliant with existing regulations.

It will also study stronger protections for consumers against multiple loans and roll-over loans and review the maximum total cost of borrowing.

That cost is currently capped at a $21 fee for every $100 borrowed

There are more than 750 payday loan storefronts in Ontario where consumers take out an average payday loan of $300 and pay up to $63 in fees.

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