Nunziata concerned about payday loan shops

Weston likely has more payday loan shops than any other part of Toronto. That may change, if only a little, as loan businesses come under increased pressure from local government.

For a large fee, payday loan shops will convert a post-dated cheque into cash. They are often used for short-term ‘cash crunches’, when a person is employed but does not have enough money to meet immediate expenses. The loans, however, are very expensive: Cash Money, a very popular franchise with 350 locations in Canada and 5 locations within 5 km of Weston, charges $21 for a 14 day loan of $100, the maximum allowed by law.

Payday loan and cheque-cashing business have been expanding rapidly but have recently been subject to much more regulation. Last year, the province restricted the amount of interest lenders could charge and limited their ability to ‘rollover’ loans—paying off one loan with another to the same client. These practices made it difficult for clients to get control of their debts.

The Etobicoke York Community Council (which covers Weston), heard a report today about payday loan stores. The report was commissioned because the council identified a “proliferation” of payday loan stores in the neighbourhood and because of concerns that these stores were operating without the correct permits. The council was concerned that some payday loan stores were accepting collateral (like old gold).

The report was referred for further review.

Two new businesses in Weston

The shakeup in Canada’s cell phone sector has caused aftershocks in Weston.

Mobilicity and Public Mobile are new wireless providers starting up in Weston and elsewhere in the GTA. Because newly-available radio spectrum was auctioned in 2008, entrants were able to compete with the three incumbent oligopolists: Bell, Telus and Rogers.

The challengers’ advantages? Price and freedom. “A lot of people are fed up with contracts”, says Saleem Muhammad, Mobilicity’s manager in Weston. “All of our plans are unlimited, and you can stop your service whenever you want.”

They are now are scrambling to lure Canadians out of long contracts, and establishing a beachhead of storefronts has been a part of that effort. Wind Mobile, the first entrant to start selling plans, has had a rough start in part because it had no storefronts of its own, only kiosks in Blockbuster Video stores.

Public Mobile and Mobilicity appear to have learned from Wind’s experience and are leasing many locations across the GTA, including in Weston. Mobilicity’s Weston location has been open since the 15th, and Public Mobile’s has been open for about a month. According to emplyees, both have had a slow start, but they are upbeat about building momentum.