How payday loans work in Ontario
Ontario regulates payday loans under the Payday Loans Act, 2008, one of the most detailed payday lending laws in Canada. Every lender and loan broker that serves Ontarians, online or in a store, needs a provincial licence.
Since January 1, 2025, a payday loan in Ontario can cost no more than $14 per $100 borrowed, including every fee, under the federal Criminal Interest Rate Regulations. The loan can be up to $1,500 and can't run longer than 62 days.
How much you can borrow in Ontario
A payday loan in Ontario can be no more than 50% of your net pay for the pay period, up to the national maximum of $1,500. With take-home pay of $1,200 per pay period, the most you could borrow is $600.
What a payday loan costs in Ontario
| You borrow | Maximum cost | Total to repay | APR on 14 days |
|---|---|---|---|
| $300 | $42 | $342 | 365% |
| $500 | $70 | $570 | 365% |
| $1,000 | $140 | $1,140 | 365% |
| $1,500 | $210 | $1,710 | 365% |
Your rights as a borrower in Ontario
- Cancellation: You can cancel within two business days of receiving the money, with no penalty and no reason needed.
- Repeat loans: Rollovers are banned, and if you take out three payday loans from the same lender within 63 days, the lender must offer you an extended payment plan so you can repay in instalments.
- Late or missed payments: If you miss a payment, the lender can charge interest of up to 2.5% per month on the overdue amount, not compounded, plus one dishonoured payment fee of up to $20.
- Early repayment: you can repay early without a prepayment penalty.
- Disclosure: your written agreement must show the amount, the total cost in dollars, the APR and every due date before you sign.
- No extras: a lender can't require insurance or charge you anything upfront.
Ontario's extended payment plan is one of the strongest protections in the country. It kicks in automatically after your third loan in 63 days, and you can leave the plan or repay early at any time without a fee. If you find yourself borrowing that often, it's also a sign to talk to a non-profit credit counsellor.
Applying online from anywhere in Ontario
You can apply for an online or e-Transfer payday loan from anywhere in the province, including Toronto, Ottawa, Mississauga, Brampton, Hamilton, London, Kitchener, Windsor, Sudbury and Thunder Bay. The same provincial rules apply whether you live in a large city or a small town, and whether you borrow online or at a store.
To apply, you'll need to be at least 18 (the age of majority in Ontario), have had regular income for three months or more, and have an active Canadian bank account. See how it works for the full process.
Payday loans in Ontario cities
Ontario's rules are the same across the province, but local costs, jobs and free supports differ from city to city. Choose your city for a local guide.
How to check a lender's licence in Ontario
Payday lenders in Ontario are licensed and overseen by Ontario's Ministry of Public and Business Service Delivery (Consumer Protection Ontario). A legitimate lender will show its licence number on its website and in your loan agreement. If you can't find it, check the regulator's public list before you sign anything, and walk away from any lender that asks for money upfront.
If you're struggling to repay in Ontario
Contact your lender before the due date and ask about a payment plan. A non-profit credit counselling agency can review your budget for free, and Consumer Protection Ontario can help if you believe a lender broke provincial rules. Our responsible lending guide lists more options.