Cheap payday loans

Payday loans are small loans with very short repayment terms. Depending on where you live in Canada, the borrowing fee can be anywhere between $14 to $17 for every $100 borrowed. Payday loans are designed to be expensive, and lenders in this space tend to charge the maximum fee they’re legally allowed to in the province.

Is it possible to find cheap payday loans?

Unfortunately, no. There’s no such a thing as a cheap payday loan.

Payday loans are high-interest loans because they are designed for high-risk borrowers who can’t qualify for a loan from traditional lenders, such as banks. Borrowers are considered high risk of defaulting on a loan if they have poor credit, no credit, too many debts, low income or unstable employment.

Let’s say you want to take out a $500 payday loan in British Columbia that you’ll repay in 14 days. Your borrowing fee will be $75. Expressed as an annual percentage rate (APR), the rate is extremely high – 391%.

Questions to ask before getting a payday loan

If you’re considering a payday loan, ask yourself the following questions before applying:

• Can you repay the full amount in time? Defaulting on a loan leads to more fees. If you think you might have trouble repaying the loan within a short period of time, avoid taking it out in the first place.
• Will you have enough money left? Once you successfully repay your payday loan, will you have enough money left in your bank account to pay for your usual expenses? If not, you might find yourself needing to take out another payday loan, and this is what causes a cycle of debt.
• 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 follow provincial regulations? Each province has its own regulations for payday loans, such as maximum borrowing cost, loan terms, fees for loans in default and more.
• How transparent is the lender about fees? The provinces also have rules about how lenders should disclose their payday loan fees.
• Does the lender assess your ability to repay? Lenders must make a reasonable judgment on your ability to repay the loan. They do so by looking at factors such as your monthly income and debts. 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.

Compare payday loans

If you think a payday loan is right for your situation, below are licensed payday lenders in Canada.

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Name	Product	Loan Amount	Loan Term	Interest Rate	Turnaround Time	Serviced Provinces	Offer	Table description
GoDay Payday Loan GoDay Payday Loan		$100 - $1,500	Up to 62 days	Varies by province	As little as 2 minutes with INTERAC e-Transfer®	AB, BC, MB, NB, NS, ON, PEI, SK		To apply, you'll need to be a Canadian resident over the age of 18 with a valid email address, phone number and an open bank account with a Canadian bank or credit union.	Go to site View details	Compare	loading Fetching your data...
iCASH Payday Loan 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.	Same day cash up to $1,500 for car payments, rent, mortgage, home & appliance repair, and more. 24/7 instant approval and e-Transfer funding. Income of at least $800/month required.	Go to site View details	Compare	loading Fetching your data...

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Eligibility criteria for payday loans

Although it varies between lenders, you will typically need to meet the following requirements:

• Be 18 years old, or the age of majority in your province or territory
• Have a valid bank account
• Be a Canadian citizen or permanent resident
• Have proof of a steady income

Alternatives to payday loans

Rather than trying to look for low interest payday loans, consider these alternatives:

• Financial assistance from non-profits. Visit 211.ca to get connected to the support you need.
• Negotiate with your creditors. For example, you could reach out to your landlord or hydro company to work out a partial repayment plan.
• Credit card cash advance. This is cash borrowed from the credit limit of your card. Its APR is around 23%, plus you’ll pay a fee that’s a percentage of the amount borrowed.
• Installment loans. You may be able to qualify for an installment loan. APRs range from 18% to 46.96%. This is an expensive option, but it breaks up your payments over several months, which creates room in your monthly budget. Learn about the best installment loans.
• Cosigned personal loan. If you have a friend or family member with good finances who is willing to cosign a loan, this can help you get a personal loan with a lower interest rate. If you don’t make your repayments, your cosigner’s finances will also take a hit.

Alternatives to payday loans

Frequently asked questions

• What is the maximum amount I can borrow?

  Most payday loans have a maximum loan amount of $1,500, but the most you can borrow will depend on your personal factors, including your ability to pay back the loan and your province. For example, in Ontario you can only borrow up to 50% of your net income.

• How much time does it take to complete an online application?

  If you have all of the necessary documentation on hand, including your personal details, banking details and financial details, you can complete and submit your application in around 5 to 10 minutes and get funded within the hour.