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Payday loans for welfare recipients in Canada

Find out where you can apply for payday loans as a welfare recipient in Canada, plus see other loans available to you.

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Need a payday loan?

Money Mart Payday Loan logo
  • Accepts social assistance
  • Get cash 24/7
  • APR & loan term vary by province
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Payday loans are fast and convenient, but they are also extremely expensive. Find out where you can apply for payday loans as a welfare recipient in Canada and what you need to know before signing on the dotted line.

⚠️ Warning: Be cautious with payday loans
Payday loans are expensive. If you're experiencing financial hardship call Credit Counselling Canada for free financial counselling (Monday-Friday 8:00am-5:00pm at +1 866-398-5999). Consider alternatives instead of a payday loan:
  • Local resources. Government programs and nonprofits offer free financial services and help with food, utilities and rent.
  • Debt relief companies. There are services to help you reduce your debt payments.
  • Payment extensions. Talk with bill providers about longer payment plans or due-date extensions.
  • Side jobs. Sell unwanted items online, sign up for food delivery and more.

Compare payday loans for welfare recipients in Canada

Name Product Loan Amount Loan Term Interest Rate Turnaround Time Serviced Provinces
Money Mart Payday Loan
$120 - $1,500
1 - 62 days
Varies by province
As little as 1 hour after getting approved
AB, BC, MB, NS, ON, SK
To be eligible, you’ll need to be at least 18 years of age with a steady source of income and a chequing account. No credit check required.
iCASH Payday Loan
$100 - $1,500
7 - 62 days
Varies by province
As little as 2 minutes with INTERAC e-Transfer
AB, BC, MB, NB, NS, ON, PEI
Get up to 20% in cash back once your payday loan is fully repaid. Conditions apply.

To be eligible, you'll need to be at least 19 years of age and have a net income of at least $800/month deposited into your bank account.
Cash Money Payday Loan
$100 - $1,500
5 - 40 days
Varies by province
As little as 15 minutes with INTERAC e-Transfer
BC, NL, NS, ON, SK
Apply for your first $300 payday loan at a $20 cost (excludes SK applicants).

You'll need to be 18 years of age or older and have a net income of at least $1,000/month. Residents of MB and NB must apply in-store for a loan.
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Maximum borrowing costs per province
Always refer to your contract for exact repayment amounts and costs as they may vary from our results.
Province Maximum allowable cost of borrowing
Alberta, British Columbia, New Brunswick, Ontario & Prince Edward Island $15 per $100 borrowed
Manitoba & Saskatchewan $17 per $100 borrowed
Nova Scotia $19 per $100 borrowed
Newfoundland and Labrador $21 per $100 borrowed
Northwest Territories, Nunavut & the Yukon $60 per $100 borrowed
Quebec Limit of 35% annual interest rate (AIR)

What should I know about payday loans for social assistance?

Canadian lenders look at your income to check whether you can afford a loan. Not all lenders recognize welfare or social assistance as a valid form of income, so if you’re looking for payday loans for social assistance, your first step is to find a lender that accepts this income.

Fortunately, payday loans have lenient requirements, so there are payday lenders in Canada that accept welfare. But payday loans are extremely expensive and should only be a last resort. Also, the payday loan space is known to be predatory.

If you’re set on a payday loan, choose a lender that follows provincial regulations and properly assesses your ability to repay a loan.

Features of payday loans for welfare recipients

  • Loan amount. It is typically between $100 to $1,500, but some provinces, such as Ontario and BC, limit the amount to a percentage of your income (50% for these provinces).
  • Loan term. Payday loans must be repaid by your next payday, which is usually within 1 to 4 weeks. An extremely short loan term doesn’t give your finances much time to recover.
  • Borrowing fee. The provinces have maximum borrowing fees. Provinces like Alberta, BC and Ontario have a limit of $15 for every $100 borrowed.
  • Bad credit is OK. Having poor credit doesn’t necessarily mean you’ll be denied a payday loan. Payday loans have more flexible eligibility requirements than other loans.
  • Non-employment income is OK. Some payday lenders accept non-employment income such as government benefits, which include welfare, and private pensions.

How do I compare payday loans that accept social assistance in Canada?

When comparing payday loans as a welfare recipient, ask yourself the following questions:

  • What is the reputation of the lender? Check third-party reviews to see what other people have to say about the lender.
  • Does the lender abide by provincial regulations? Each province has its own regulations for payday loans, such as maximum borrowing cost, loan terms, rollovers and more.
  • Is the lender transparent about fees? The provinces also have rules about how lenders should disclose fees. Look at how the lender breaks down the cost to borrow a payday loan. If you look at the borrowing fee of a payday loan as an annual interest rate, the rate is in the triple digits.
  • Does the lender assess your ability to repay? Lenders must make a reasonable judgment on a welfare recipient’s ability to repay the loan. They do so by looking at factors such as your income, living expenses and existing debt. They might also do a credit check. If a lender doesn’t ask you for any of this information, then it is probably not legitimate.

    How to apply for payday loans as a welfare recipient

    While it varies among lenders, you will usually need to supply the following information:

    • Valid ID with your name and address.
    • Valid phone number.
    • Pay cycle frequency (e.g. bi-weekly or monthly).
    • Net and gross amounts of all your income, including your welfare income.
    • Proof of welfare income (you can get this by logging into your CRA MyAccount)
    • Bank account information where your funds will be transferred (chequing account, routing and institution numbers).

    How do I get my payday loan?

    Payday lenders offer various ways to get your funds:

    • E-transfer. Once you’re approved, the payday lender will send the funds to your email address, which you then deposit into your bank account. This is typically the fastest way to get your payday loan online.
    • Direct deposit. With this method, you give your banking information or void cheque to your lender, who will then deposit the funds directly into your bank account.
    • Cash in-store. You can visit a physical store, get approved on the spot and walk out with your funds. Lenders can give you cash, load it into a prepaid debit card or send you an e-transfer.

    Compare payday loans for welfare recipients

    What to watch out for

    While they’re convenient when you’re in a financial bind, here are some things to keep in mind about payday loans for social assistance:

    • Cycle of debt. The exorbitant rates, short repayment terms and late payment fees of payday loans can cause a cycle of debt. If you think you might have problems repaying the loan, avoid getting it in the first place.
    • Scams. There are lenders who prey on people who need money urgently. Be careful when selecting a lender and do research to find one who is reputable and trustworthy.

    Other loans for people on social assistance

    • Lines of credit. There are online lenders that can offer lines of credit to people on welfare. Jump to lines of credit.
    • Installment loans. If you receive other regular government benefits with your welfare income, you could be eligible for an installment loan. Jump to installment loans.

    Lines of credit for welfare recipients in Canada

    The online lenders below can consider welfare as income as long as you meet the minimum income.

    Name Product Interest Rate Loan Amount Loan Term Requirements Link
    Mogo Mini Line of Credit
    Mogo Mini Line of Credit
    47.42%
    $1,000 - $3,500
    No end dates
    Requirements: min. income $13,000/year, min. credit score 500
    Go to site
    More Info
    Apply online and get pre-approved in just 3 minutes. Non-employment income also accepted. Pay back loan at any time.
    Cash Money Line of Credit
    Cash Money Line of Credit
    46.93%
    $100 (in store), $500 (online) - $10,000
    No end dates
    Requirements: min. credit score 560
    Go to site
    More Info
    Residents in AB, BC, NL, NS, ON and SK can apply online. Residents of MB or NB can apply in-store only.
    LendDirect Line of Credit
    LendDirect Line of Credit
    19.99% - 46.93%
    $100 - $15,000
    No end dates
    Requirements: min. income $1,500/month, min. credit score 560
    Go to site
    More Info
    If approved, receive access to funds in as little as 15 minutes.
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    Features of lines of credit

    • Open term. Unlike a payday loan, you can pay off your loan partially or in full any time. A flexible term allows you to repay the loan when you’re in a better financial position.
    • Borrow up to your limit. You can borrow as much or as little you want up to a predetermined limit.
    • Potentially cheaper than a payday loan. For example, Mogo says its MogoMini line of credit is 88% cheaper than a payday loan.
    • High interest rate. Even though an online line of credit is potentially cheaper than a payday loan, it still comes with a high interest rate.

    What to watch out for

    • Waiting too long to repay your loan. With an open term, it can be tempting to only pay the interest and hold off on repaying the loan. But if you wait too long, you could end up paying more interest than a payday loan.
    • Overspending. With easy access to funds, it can be tempting to borrow more than you need.

    Go back to payday loans

    Installment loans for social assistance

    If you receive other recurring government benefits in addition to welfare, you could be eligible for an installment loan. This is a type of personal loan offered by online lenders with smaller loan amounts, shorter terms and higher rates than the average personal loan.

    Name Product Interest Rate Loan Amount Loan Term Requirements Link
    Money Mart Installment Loan
    OFFER
    Money Mart Installment Loan
    29.90% - 46.90%
    $1,000 - $15,000
    12 - 60 months
    Requirements: min. credit score 300
    Go to site
    More Info
    Get a $100 eGift card when you apply online, connect your bank account using Express and make your first payment.
    LoanConnect Installment Loan
    LoanConnect Installment Loan
    32.00%
    $500 - $2,500
    3 - 6 months
    Requirements: current debt must total less than 60% of income, min. credit score 300
    Go to site
    More Info
    Get approved by different lenders in as little as 60 seconds with any credit score.
    Loans Canada Installment Loan
    Loans Canada Installment Loan
    8.00% to 46.96%
    $500 - $50,000
    3 - 60 months
    Requirements: min. credit score 300
    Go to site
    More Info
    A broker with the largest lender network in Canada. Fill out one application and get matched for free with lenders.
    Cash Money Installment Loan
    Cash Money Installment Loan
    46.93%
    $500 - $10,000
    6 - 60 months
    Requirements: stable source of income, min. credit score 560
    Go to site
    More Info
    Online installment loans are available in Alberta only. Residents of Manitoba and New Brunswick must apply in-store.
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    Features of installment loans

    • Unsecured. You don’t need to put up any collateral.
    • Fixed loan terms. Loan terms are usually between 6 months and 5 years.
    • Fixed loan amounts. Loan amounts are typically between $500 and $10,000.

    What to watch out for with installment loans

    Installment loans are a convenient way to get the funding that you need, but they come with some drawbacks. They include:

    • Inflexibility with your loan term. Unlike a line of credit, you have a fixed loan term and a regular schedule to repay your loan.
    • Potential fees. See if the lender charges extra fees, such as prepayment fees and origination fees (processing fee deducted from the loan amount).
    • High interest rates for bad credit. Lenders view borrowers with bad credit as higher risk, so they charge higher interest rates.

    Tips for getting loans on social assistance

    • Do not rush. Do not rush into signing a contract without knowing the terms of your loan, including the cost, loan term and repayment schedule. Avoid lenders that do not clarify the terms of your loan.
    • Avoid lenders that require loan insurance. Loan insurance should be completely optional, never required.
    • Avoid lenders that ask for payment up front. Legitimate lenders do not ask for payment up front. If you encounter someone asking for this, it could be a scam.

    Other funding options for people receiving social assistance

    Here are other possible loan options for people on welfare:

    • Credit card cash advances. This may be an option if you already have a credit card and haven’t borrowed up to your credit limit. Credit card cash advances have lower rates than payday loans, with APRs usually around 20-23%.
    • Car title loans. With an auto title loan, you put your vehicle up as collateral. If you fail to pay back your loan, the lender can repossess your car, boat, RV or motorcycle. For these types of loans, you usually have to outright own your vehicle.
    • Home equity loans. Are you a homeowner? You may be able to borrow against your home’s equity through a home equity loan or line of credit. This is a secured loan – meaning you use your house as collateral – but it often comes with more lax eligibility criteria than an unsecured personal loan.

    Installment loan vs payday loan: Which is better?

    Let’s say a recipient of Ontario Works is looking to take out a loan.

    Payday loanInstallment loan
    Loan amount needed$500.00$500.00
    Cost of loan$15 per $100 borrowed ($75.00 total). This is an APR of 391.07%33% APR
    Loan term14 days6 months
    Payment amount One full payment of $575.00$91.54 monthly for 6 months
    Total loan cost$575.00$549.24

    In this case, it’s cheaper to get an installment loan. The fees and interest rate are lower, resulting in an total savings of $25.76.

    *The information in this example, including rates, fees and terms, is provided as a representative transaction. The actual cost of the product may vary depending on the retailer, the product specs and other factors.

    Bottom line

    Look for lenders that accept welfare as a valid source of income. Carefully compare rates and fees, and take the time to understand the terms and conditions of any loan you’re interested in getting.

    If approved, you should receive the loan in your bank account within minutes or up to a couple of business days, depending on how the funds are sent. If you apply in person at a payday loan branch, you may be able to leave with cash immediately upon approval.

    Frequently asked questions

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