Archive for March 2017

Consolidation in non-profit credit counselling industry inevitable

Canadians struggling with consumer debt spend millions of dollars to deal with their debt situation.  Some will take out a debt consolidation loan.  Some will hire a debt settlement firm.  Others will “go for credit counselling”.  Some will meet with debt consultants often referred to as “intermediaries”.  Finally, some will meet with a bankruptcy trustee, now known as a Licensed Insolvency Trustee (LIT), and make a consumer proposal or file for bankruptcy.

Make no mistake.  These debt relief service providers compete aggressively for these clients.  And a significant amount of revenues are at stake.  If you live in southern Ontario try listening to the radio without hearing an ad for a Licensed Insolvency Trustee or Consolidated Credit Services, one of Canada’s three largest non-profit credit counselling agencies.


Consolidation coming to non-profit credit counselling industry

The debt relief service industry is currently undergoing a period of consolidation.  We are already seeing this among Licensed Insolvency Trustees across Canada.  It is only a matter of time, however, before we will also see consolidation in the non-profit credit counselling industry.


The major players in the non-profit credit counselling

The Big 3 among Canada’s non-profit credit counselling industry includes Toronto-based Credit Canada Debt Solutions and Consolidated Credit Counseling Services, as well as New Westminster, B.C.-based Credit Counseling Society.  One might argue that the Credit Counselling Services of Atlantic Canada should also be included in this group.


3 Reasons Revenues for the Big 3 have flatlined

According to financial statements available on CRA’s website, the combined total revenues for the Big 3 have remained stagnant around $24 million since 2012, adjusted for inflation.  This is despite the fact that the Big 3 have spent, collectively, more than $4 million annually on Advertising and Promotion in taxation years 2012 through 2015.

  1. consumer proposals are becoming more popular
  2. higher household debt levels make DMPs less affordable
  3. bill collectors are less likely to “drive” consumers to non-profit credit counselling agencies


Consumer proposals are becoming a more popular alternative

One of the reasons that the total revenues for the Big 3 have hit a wall over the past several years is the increasing popularity of another debt relief alternative, the consumer proposal.

Consumer proposals are only available through Licensed Insolvency Trustees.  Under a consumer proposal a consumer will repay an amount–typically equal to 25 to 50 percent of their outstanding indebtedness–by making monthly installment payments over a period not to exceed five years.  In contrast, when a consumer enrolls in a Debt Management Plan he or she will repay an amount equal to somewhere between 100 percent and 120 percent of their indebtedness.

Licensed Insolvency Trustees routinely decline to do consumer proposals where the consumer has less than $10,000 in unsecured consumer debt.  Where a consumer owes more than $10,000 in unsecured consumer debt then a consumer proposal is three times less expensive to eliminate one dollar of debt.


Higher household debt makes Debt Management Plans less affordable

According to Doug Hoyes, Founder of Hoyes & Michalos, Licensed Insolvency Trustees, “Ten years ago a consumer who owed $10,000 could afford to do a Debt Management Plan where he or she repaid $1,100 by making monthly installments over three years. Today, however, higher household debt means that Debt Management Plans are becoming less affordable because either the monthly payments or higher or the Debt Management Plans are longer.”

According to Scott Hannah, President and CEO of Credit Counselling Society, the typical Debt Management Plan his agency sees is one where the consumer owes between $25,000 to $40,000.  He concedes that the higher the amount of money owing in a Debt Management Plan the more that affordability becomes an issue.


Consumers are receiving fewer collection calls from bill collectors

In the past anxiety generated by aggressive bill collectors to consumers with unpaid accounts were often sufficient motivation to persuade a consumer to contact a non-profit credit counselling agency and enroll in a Debt Management Plan.

Compared with ten years ago, however, bill collectors are much less likely to get a consumer who owes money on the phone to make a demand for payment.  Recent studies indicate that ninety percent of Canadians under 30 never talk on their cellphone.  In the future we should expect that bill collectors might get fewer and fewer consumers who owe money on the phone to make a payment demand.


Inevitable consolidation in the non-profit credit counselling industry

According to Scott Hannah, President and CEO of Credit Counselling Society, “in the next three years you will see some consolidation or mergers in the non-profit credit counselling industry.  I also expect that in the future that some of the smaller, community-based non-profit credit counselling agencies will no longer be financially viable in the marketplace.”


Share any relevant information with me and our readers

If you become aware of any information dealing with consolidation or mergers in the non-profit credit counselling industry then I would invite you to contact Mark Silverthorn at (519) 827-5513 or toll free at 1 (866) 996-9941 or via e-mail at

Guest Post: Saving money and having fun with food

Mark Silverthorn

I am delighted to announce that Danielle Lorimer, the President of Comprehensive Debt Solutions, will be contributing a guest blog post on the Mark Silverthorn Blog on a regular basis.  The focus of Danielle’s guest posts will be on personal finance issues.  This is the first of what I hope to be many guest posts from Danielle.

Danielle Lorimer


Over the past few years I have experienced a significant drop in my annual income–as much as 50 percent.  This has actually turned out to be a blessing in disguise.  I have challenged myself to not only live on a smaller household budget but also to have fun doing so.

Many of you who are reading this blog post may have experienced a similar reduction in household income.  In my series of blog posts I hope to share with you my journey.


Saving money buying heavily discounted grocery items

I now save a boatload of money by purchasing heavily discounted items at the grocery store–not to be confused with weekly specials.  Each week at a no frills supermarket it is possible to purchase items in various departments which have been heavily discounted.

Taking full advantage of these heavily discounted items requires some strategic considerations.  Firstly, when purchasing clearance items at the grocery store it is helpful if a shopper is opportunistic.  Secondly, the availability of heavily discounted clearance items is going to dictate, to some extent, what is on the menu over the next 48 hours.  If you buy a quantity of brussel sprouts from the clearance shelf in the produce section then ideally you should have brussel sprouts for dinner that evening.

It is possible to save significant amounts of money purchasing meat which has been heavily discounted.  These items will often contain stickers with the phrase “Reduced for Quick Sale” or “Enjoy me Tonight”.  If you purchase one of these clearance items you don’t have to eat it that same day if you put the item in your freezer at home.  In order to maximize your savings on buying meat you can try to limit your meat purchases to those which are heavily discounted.

In the produce section of a grocery store there is typically a clearance cart on wheels with multiple shelves containing heavily reduced fruit and vegetables.  I will often buy from this produce clearance cart and use these items in my meals that evening or the following day.

Near the cash registers at many grocery stores there is often a section containing clearance items for non-perishable items.  It never hurts to look at this shelf.  You might find something that you need heavily marked down in price.

Many items found in a grocery store contain a BEST BEFORE DATE.  An item is not unfit for human consumption after the expiry of a Best Before Date.  A food item with an expired Best Before Date may experience some deterioration in flavour and texture.


Saving money eating at home

I enjoy eating out at a restaurant from time to time.  Unfortunately, there are several reasons why I prefer to eat at home.  Firstly, eating out can be incredibly expensive, particularly when you consider the additional cost of gratuities and H.S.T. imposed on restaurant meals.  Secondly, when I prepare a meal I know what ingredients are used and how it is made.  Thirdly, I find that I can often prepare a meal better than when I eat it at a restaurant.  Fourthly, I have found that the service at many restaurants leaves plenty to be desired.  Finally, sometimes the conduct of other patrons in a restaurant can prejudice your ability to enjoy your dining experience.


Developing a repertoire of yummy recipes

I am in my 50’s and until a few years ago I couldn’t boil water.  I didn’t cook my first Christmas turkey until I was 50 years of age.  I was able to get some books at my local library on basic cooking techniques.

Now I am using the internet to find potential recipes.  One of my favourite sites for recipes is  I would invite you to check it out!

I still remember my first culinary success using heavily discounted ingredients.  I prepared a light lasagna using ground chicken and ricotta cheese.  It was delicious.


How to make eating meals fun

At dinner I like to try and recreate the romantic ambiance of a restaurant at home.  This means the lights are turned down, using candles and no distractions, including having the television on.

Just to mix things up a bit sometimes we will eat a fun meal–burgers or tacos in front of the television while we watch some special programming.


I am too tired to cook tonight

I don’t feel like Julia Childs every evening.  In anticipatation of this, I usually cook enough food earlier in the week so that I have a homemade meal that I can reheat in the microwave.  I also keep on hand ingredients for simple dishes that can be made quickly.  This includes frozen pizza crusts and ingredients suitable for use as toppings on a pizza.

What are some of your tips for saving money and having fun?  I would invite you to share your ideas with me and they may appear in a future blog post.  You are welcome to send your ideas to me at

Laws Regulating Collection Agencies a Confusing Patchwork Quilt


Mark Silverthorn has spent more than three decades as a student of the law regulating collection agencies in Canada.


In Canada each province and territory not only licenses but also regulates the conduct of collection agencies.  The result is a patchwork quilt of inconsistent laws across the country.

Collection agencies, for example, are legally permitted to call the workplace of a Saskatchewan resident with an outstanding account–but are prohibited from making any phone calls of any kind to the place of employment of a consumer living in Newfoundland.


Relevant law is the law where the consumer lives

An individual may be receiving phone calls from a collection agency which has offices in his or her province, in another Canadian province, or from outside Canada.  The relevant law regulating the conduct of collection agencies is the one where the recipient of the phone call from a collection agency resides.


Collection agency-specific statute versus component of provincial consumer protection law

Provincial and territorial law regulating collection agencies in Canada fall into one of two broad categories:

  • collection agency-specific regulation
  • consumer protection legislation

In some provinces the provincial law regulating collection agencies is specific to collection agencies.  These narrowly focused statutes describes provincial law regulating collection agencies in Ontario, Quebec, Saskatchewan, and the four Atlantic provinces. The law in British Columbia, Alberta, Manitoba and the three territories regulating collection agencies is contained in a much broader consumer protection statute regulating industries including but not limited to the collection industry.


Law regulating collection agencies may be contained in regulations

It is common for provincial statutes to permit some of the law in a provincial statute to be enacted pursuant to regulation.  The law regulating collection agencies in British Columbia, Alberta, Ontario, Quebec, Newfoundland and Nova Scotia can be found in the regulations.


Names of specific statutes regulating collection agencies

You can find the names of provincial  and territorial statutes and regulations regulating collection agencies at the following link on on a webpage titled “Provincial Regulation of Bill Collectors”.