Cash Money Payday Loan

- Borrow from $100-$1,500
- Approval decision in minutes
- APR & loan term vary by province
Payday loans are small loans with very short repayment terms and exorbitant borrowing fees. Depending on your province or territory, you could pay between $15 and $25 for every $100 borrowed.
The annual percentage rates (APR) for payday loans in Canada are much higher compared to other types of loans. APR is a loan’s interest rate and fees expressed as an annual cost. It gives you a truer view of the cost of a loan, and it helps you compare the cost of different types of loans.
Payday loan APRs typically range from about 390% to 780%, with many payday loans sitting around the 540% APR mark. As an example, let’s take a $900 payday loan in Ontario with a borrowing fee of $135 ($15 charged for every $100 borrowed). If you have a repayment term of 14 days, your APR would come out to 391.07%.
Payday loans have higher APRs compared to credit card cash advances and personal loans for bad credit. Credit card cash advances typically have a 23% APR plus a fee, while bad credit personal loans tend to max out at 47% APR.
Let’s go back to the $900 example. Here’s how the costs would compare:
Payday loan ($15 for every $100 borrowed) | Credit card cash advance (23% APR + 5% fee) | Personal loan (46.96% APR) | |
---|---|---|---|
Loan amount | $900 | $900 | $900 |
Loan term | 21 days | 21 days | 6 months |
Borrowing cost | $135 | $11.91 + $45 = $56.91 | $171.20 monthly payment, $127.21 in total interest |
The credit card cash advance is the cheapest option. The costs of the bad credit personal loan and payday loan are almost the same in dollar terms. The key difference is the loan term; the personal loan has a longer loan term of 6 months, allowing you to spread out your payments.
Unlike other types of loans, the borrowing fee of a payday loan is the same for borrowers and does not depend on personal factors, such as credit score and income. Lenders in the payday loan space tend to charge the maximum they’re legally allowed to, no matter your financial situation.
The payday loan’s APR, however, can change depending on your loan term. Let’s go back to the $900 loan example with a borrowing fee of $135:
Loan amount | Borrowing fee | Loan term | APR |
---|---|---|---|
$900 | $135 | 14 days | 391.07% |
$900 | $135 | 21 days | 260.71% |
$900 | $135 | 42 days | 130.36% |
$900 | $135 | 62 days | 88.31% |
Even with the maximum loan term allowed for payday loans, the APR is still very high.
If you want to take out a payday loan, a lender cannot charge you any fees besides the borrowing fee. However, if your payday loan goes into default, you can be charged fees like NSF fees and late payment fees.
Before getting a payday loan, examine your financial situation and decide if a payday loan is truly the best option for your financial needs. If you don’t think you can make the repayments, don’t take a loan out in the first place. Explore other financial options like a credit card cash advance, a bad credit installment loan or a line of credit. Payday loans should be a last resort.
If you decide that a payday loan is the best option for you, be absolutely sure that you can afford to make the repayments on time.
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) |
If you’re interested in applying for a payday loan, follow these steps:
Learn more about payday loans for those with bad credit
Payday loans are available in all provinces and territories across Canada. You should be aware that payday loans are regulated by individual provinces, which means costs and fees can vary. Ensure that any lender you choose abides by the laws of the place you live.
The Yukon, Nunavut and the Northwest Territories do not have legislation regulating payday loans at the territorial level. Payday loans are regulated in these territories at the federal level only.
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