Payday Loans Toronto, Ontario

📅 Last Updated: January 2, 2025

✏️ Written By Lisa Rennie

🕵️ Fact-Checked by Caitlin Wood

Table of Contents show

Can You Get A Payday Loan In Toronto?

Yes, you can get a payday loan in Toronto online or in person. With it, you can get between $100 to $1,500. Though, the amount you qualify for greatly depends on your income level. Before you borrow a payday loan in Toronto, make sure to do some research and find a legitimate lender.

Even though payday loans are easier to get than other loan products, they can have really high-interest rates and fees.

What Is A Payday Loan?

Payday loans in Toronto are small loans that are made for no more than $1,500. Their repayment time frames are relatively short; usually, the full loan amount, along with any interest and fees, must be repaid by the borrower’s next paycheck in one lump sum.

While these loans are easy to qualify for, they have extremely high-interest rates and short terms. This combination makes payday loans dangerous as you can easily fall behind on payments and fall into debt.

Note: Payday loans are extremely expensive and can lead to a cycle of debt if you’re unable to repay the full amount borrowed. Learn about the payday loan laws in your province, click here.

Payday Loans Vs Personal Loans

There are significant differences between payday loans and personal loans, including the following:

Term. Payday loans in Toronto usually have to be paid back within two weeks, or when your next paycheck comes in. Personal loans usually have much longer terms (3 months to 5 years), making them easier to pay off.
Payments. Payday loans are repaid in one lump sum, while personal loans are repaid in installments.
Interest rates. As mentioned earlier, payday loans come with extremely high-interest rates. If you have a decent credit score, you can get a personal loan at a relatively low rate, one that’s far lower than those that come with payday loans. If you’re thinking of applying for a personal loan, be sure to check your credit score first.

Are You Eligible For A Payday Loan In Toronto?

Since payday loans have minimal requirements, they are appealing to people with bad credit and lower financial health. To qualify for a payday loan in Toronto, you only need:

To be a Canadian resident and over the age of majority (18 years in Ontario)
A reliable source of recurring income
An active chequing account with direct deposit and/or e-Transfers

Learn How To Qualify For Other Loan Amounts

Can I Get A Payday Loan In Toronto Via e-Transfer?

Yes, e-Transfer is the most popular way to get a payday loan online in Ontario, since it allows borrowers to collect their funds, quickly and easily, at any time of day. For this option, the lender will need your banking information to send your payday loan via INTERAC e-Transfer. You can then deposit the funds directly into your bank account.

Can I Get A Cash Payday Loan Online In Toronto?

If you’re looking for physical cash, many lenders will also let you apply for a payday loan online (via their website or mobile app) and pick up the funds at a nearby branch. You’ll then have immediate access to the funds, as long as you apply during business hours.

Can I Get A Payday Loan Online In Toronto Loaded On A Prepaid Debit Card?

While they’re a bit tougher to find, some lenders offer prepaid debit cards that you can link directly to your payday loan account. In this case, the lender may be able to send you the prepaid card by post or give it to you in-person at a branch of your choosing.

Calculating The Cost Of A Payday Loan In Toronto

Every province and territory has different rules concerning the costs lenders may charge their clients. In Ontario, the maximum payday loan rate is $14 per $100 borrowed.

Here’s an example to help you understand what a payday loan can cost in Toronto:

You borrow a $1,500 payday loan with a standard 2-week term
$14 per $100 (14 × 15) = $210 maximum cost of borrowing
$1,500 + $210 = $1,710 total cost of payday loan

Payday Loan Laws In Toronto

In Canada, payday loan laws vary by region. So, before you apply, it’s equally important to learn about those regulations to avoid any issues. For instance, here are the payday loan rules that lenders must follow to operate legally in Toronto and the rest of Ontario:

How much can you borrow in Toronto? Lenders can offer payday loans up to $1,500. However, there is a law that prohibits borrowers from taking a payday loan that is more than 50% of their take-home pay. That means if you want to borrow $1,500 in Toronto, you’ll need a take-home income of $3,000.
What’s the maximum interest rate of a payday loan in Toronto? $14 per $100 borrowed is the maximum rate for a single loan.
Are there any rules on the payday loan payment? Yes, payment terms cannot exceed 62 days.
Can you take out more than one payday loan? No, lenders can only offer a client one loan at a time. Moreover, rollovers and extensions are not permitted.
Can you cancel a payday loan? Lenders must give every client a “cooling off” period of 48 hours (excluding Sundays and holidays), during which they can cancel their loan, free of charge.

Watch Out For Predatory Payday Lenders

Not all payday lenders are legitimate. Look out for the following warning signs of a predatory lender so you can steer clear of them:

They guarantee approval – Any lender in Toronto that is willing to provide you a loan without evaluating your finances or credit score is likely a scammer. Reputable lenders in Toronto will at least make some effort to make sure you’re able to repay the loan you’re taking out.

Vague terms and pricing – All loan terms should specify terms of repayment, interest, and other fees very clearly. If you have to go out of your way to find out what these are, this is a bad sign.

They’re aggressive. Any lender in Toronto who pressure you into signing a loan contract on the spot should be avoided.

Should You Get A Payday Loan?

Payday loans are rarely the right choice, but they may be something to consider if a serious situation arises in an emergency. If you’re absolutely certain you have the money to repay the payday loan in two weeks, a payday loan can be worth considering.

However, payday loans are considered a last resort option. They should only be used in situations where you know you can repay the money. They should not be used to make ends meet or pay for frivolous items.

Payday Loan Alternatives In Toronto

Installment Loan – With an installment loan, you may be able to qualify for far lower interest rates and longer terms. This can make your loan payments much more affordable.
Debt Relief – You can also consider a debt relief service in Toronto. Speaking to a credit counsellor can help evaluate your current finances and help find you a debt relief solution.
Debt Settlement – You can also consider hiring a debt settlement company to negotiate with your creditors on your behalf to lower the overall amount that you owe. Alternatively, they may also be able to negotiate a lower interest rate to make your overall debt less expensive.
Use Your Home Equity – If you own a home, you may be able to use the equity in your home as a loan. Borrowing against the equity in your home can provide you with the funds you need at a much lower interest rate. As long as you have at least 20% equity in your home after taking out the loan amount and have fair credit, a home equity loan may be a viable option.

Additional Reading

Weekend Payday Loans In Canada

Can I Have Multiple Payday Loans At The Same Time?

What Are Payday Loan Interest Rates In Canada?

Payday Loan In Toronto FAQs

I’m unemployed. Can I still get a payday loan?

Yes, depending on the lender. Some Toronto payday lenders will offer loans to people with other forms of steady income, like government benefits. For example, the Canada Pension Plan (CPP), Employment Insurance (EI), disability assistance, and private pensions may be accepted, as long as the income is enough to cover your payments.

Will a payday loan hurt my credit score?

Some payday lenders don’t check credit or report to Canada’s credit bureaus. Much of the time, they’re only interested in your ability to pay back your loan, so if you have a valid income and bank account, it shouldn’t be too hard to qualify. As such, a payday loan won’t necessarily have an impact on your credit score, negative or positive. However, if you default on your loan, your lender may report your missed payment to at least one bureau, which may hurt your credit score. If you keep avoiding your debt, they could also send your account to a collections agency. This will appear on your credit report, which may lower your credit rating and damage your credit score.

What credit score is needed to secure a payday loan?

Payday lenders don’t look at the credit scores of applicants. Instead, payday lenders in Toronto only require that you have a job, an active bank account, and a valid address. Even scores well under 650 (which is typically required for traditional loans) are OK.

Can I get a payday loan online in Toronto?

Yes, if you prefer convenience, you can apply for a payday loan online in Toronto. There are plenty of payday lenders with websites that provide easy application forms and fast approval to qualified borrowers. They also abide by the same provincial regulations as physical lenders, but don’t forget to check out each business to confirm its legitimacy. Once you find a trustworthy lender, just submit an application and wait for a decision. The whole process will only take a few minutes. If you qualify and sign the agreement, you should receive your payday loan by e-Transfer or direct deposit that day. However, if you apply outside the lender’s hours, you might only get it on the next business day.

Bottom Line

While taking out a payday loan in Toronto might make quick funds available almost immediately, they can cause a lot of debt problems. Rather than opting for another payday loan, consider other alternatives such as a personal loan.

While payday loans in Toronto are certainly available for consumers who are strapped for cash and have an expense that needs to be covered, there are other loan products available that might make a better fit. Get in touch with Loans Canada today to find a more suitable loan product for your situation in Toronto.

Get Started