Payday loan cost by province and territory in Canada
Since 1 January 2025, payday loans in provinces with a payday regime are capped at $14 per $100 borrowed, with a $20 dishonoured-payment fee and a $1,500…
How payday loan costs are set in Canada
Payday lending is regulated at two levels. The federal government sets an outer limit through the criminal rate of interest and the Criminal Interest Rate Regulations, while each province decides whether payday lending is allowed and adds its own consumer protections. That is why the cost of a payday loan depends heavily on where you live, and why some provinces do not permit the product at all.
A payday loan is a small advance repaid in a single payment, usually on your next payday and typically within 62 days. The cost is charged as a flat fee per $100 borrowed rather than as an interest rate, which makes the headline figure look small even though the annualised cost is very high.
The federal cap since January 2025
Effective 1 January 2025, the federal payday lending framework caps the fee at $14 per $100 borrowed in provinces that have a payday lending regime. The same framework caps a dishonoured-payment fee at $20 and sets the maximum payday loan at $1,500. These rules come from the Criminal Interest Rate Regulations.
The federal government also lowered the criminal rate of interest to 35% APR from 48%, effective 1 January 2025, under section 347 of the Criminal Code. That ceiling applies to credit agreements generally, including payday loans, and it underpins the fee cap in the provinces that allow the product.
Cost by province and territory
The table below shows the maximum cost per $100, the maximum loan size and the cooling-off period that applies in each jurisdiction. In provinces with a payday regime, the federal caps apply. Quebec and the territories do not permit payday lending, so the federal 35% APR ceiling governs credit instead.
| Province/Territory | Max cost per $100 | Max loan | Cooling-off period |
|---|---|---|---|
| Ontario | $14 | $1,500 | 2 business days |
| British Columbia | $14 | $1,500 | 2 business days |
| Alberta | $14 | $1,500 | 2 business days |
| Saskatchewan | $14 | $1,500 | Until next business day |
| Manitoba | $14 | $1,500 | 48 hours (excludes Sundays and holidays) |
| New Brunswick | $14 | $1,500 | 48 hours (excludes Sundays and holidays) |
| Nova Scotia | $14 | $1,500 | Next business day (2 days online) |
| Prince Edward Island | $14 | $1,500 | 2 business days |
| Newfoundland and Labrador | $14 | $1,500 | 2 business days |
| Quebec | 35% APR (no payday regime) | Not permitted | 10 days |
| Yukon | 35% APR (no payday regime) | Not permitted | Not applicable |
| Northwest Territories | 35% APR (no payday regime) | Not permitted | Not applicable |
| Nunavut | 35% APR (no payday regime) | Not permitted | Not applicable |
Cooling-off periods explained
A cooling-off period is the window in which you can cancel a payday loan and repay what you borrowed without the fee. The length varies by province, and it is a consumer protection rather than a favour from the lender. The Financial Consumer Agency of Canada lists 2 business days for Ontario, British Columbia, Alberta, Prince Edward Island and Newfoundland and Labrador. Saskatchewan and Nova Scotia give until the next business day, with Nova Scotia allowing 2 days for online loans. Manitoba and New Brunswick give 48 hours excluding Sundays and holidays.
Quebec has a 10-day cooling-off period, but since payday lending is not permitted there, it applies to other forms of credit rather than payday loans. If you take out a payday loan and then realise the repayment will not work, the cooling-off window is the cleanest exit. Act within it.
Income limits
Several provinces also limit how much of your income can go toward a payday loan. Ontario, British Columbia, Saskatchewan and Newfoundland and Labrador cap the loan at 50% of net income. Manitoba and New Brunswick set the limit at 30% of net pay. These rules exist because a loan that swallows most of a paycheque tends to be renewed rather than repaid.
Alberta, Prince Edward Island, Nova Scotia and Quebec do not appear on the FCAC list of provinces with an income limit, which does not mean a lender will ignore affordability. Responsible lenders assess whether you can repay regardless of the statutory limit.
Rollover rules by province
A rollover extends a payday loan instead of repaying it, often by paying only the fee and issuing a new loan for the principal. Rollovers are prohibited in Ontario, British Columbia, Alberta, Saskatchewan, New Brunswick, Nova Scotia and Prince Edward Island. Manitoba permits them with limits, and the rules are not specified in Newfoundland and Labrador or Quebec. Even where a rollover is allowed, it multiplies the fee without reducing the debt, which deepens the problem rather than solving it.
What a payday loan really costs
The flat fee hides the true cost. The Financial Consumer Agency of Canada gives a clear example: a 14-day $500 payday loan at the maximum fee costs $70, which works out to roughly 365% APR. Expressed that way, the cost is far higher than almost any other form of consumer credit.
Run the numbers before you borrow. A payday loan cost calculator turns the fee, the amount and the term into a total cost and an annualised figure, so you can see the real price rather than the headline.
Cheaper options to consider first
Before taking a payday loan, check whether a lower-cost option is available. An instalment loan spreads repayment over months at an interest rate rather than a flat fee. A line of credit or a credit card cash advance may cost less over the same period. A payment deferral with an existing creditor, or a short arrangement with family, can also bridge a gap without the fee. The best payday loan is often the one you avoid.
Where Promissory.ca fits
Promissory.ca is a free information and comparison service. It is not a lender, it does not lend money and it charges consumers no fee. It may receive compensation from lending partners, and that does not change the guidance here. Always confirm the current rules with your provincial regulator and read the loan agreement before you sign.
Sources
- Criminal Interest Rate Regulations SOR/2024-114 — Government of Canada, Canada Gazette
- Payday loans — Financial Consumer Agency of Canada
- Criminal Code, section 347 (criminal rate of interest) — Government of Canada, Justice Laws
Frequently asked questions
How much can a lender charge for a payday loan in Canada?
In provinces with a payday lending regime, the federal cap is $14 per $100 borrowed, with a dishonoured-payment fee capped at $20 and a maximum loan of $1,500, effective 1 January 2025. Quebec and the territories do not permit payday lending, so the federal 35% APR ceiling applies instead.
Which province has the cheapest payday loans?
In provinces that allow payday lending, the federal fee cap applies, so the maximum fee is the same across them. The bigger differences are the cooling-off period, income limits and whether rollovers are permitted. Quebec does not permit payday lending at all.
What is a cooling-off period for a payday loan?
It is the window in which you can cancel the loan and repay the amount borrowed without the fee. It ranges from the next business day in Saskatchewan and Nova Scotia to 2 business days in several provinces, and 48 hours in Manitoba and New Brunswick.
Are payday loans allowed in Quebec?
No. Quebec does not permit payday lending and caps the rate of credit at 35% per year. Consumers in Quebec cannot legally take out a payday loan, and the federal 35% APR criminal rate ceiling applies to other credit agreements.
How much does a $500 payday loan cost?
At the maximum fee of $14 per $100, a $500 payday loan carries a $70 fee. The Financial Consumer Agency of Canada notes that a 14-day $500 payday loan at that fee works out to roughly 365% APR, which shows how expensive the flat fee is once annualised.
Can I roll over a payday loan?
Rollovers are prohibited in Ontario, British Columbia, Alberta, Saskatchewan, New Brunswick, Nova Scotia and Prince Edward Island. Manitoba permits them with limits, and the rules are not specified in Newfoundland and Labrador or Quebec. Even where allowed, a rollover adds fees without reducing the debt.
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