Payday loan cost cap
Federal regulations cap the cost of a payday loan at $14 per $100 borrowed in provinces with a payday lending regime, and cap dishonoured-payment fees at $20.
The cap
Since 1 January 2025 the Criminal Interest Rate Regulations impose a federal limit on the cost of borrowing a payday loan of $14 for every $100 borrowed, in every province that operates an approved payday loan regime. The regulations also exclude dishonoured cheque fees of $20 or less from that cap.
What it costs in practice
Because payday loans are repaid over a very short term, the annualised cost is very high even though the dollar figure looks modest. The illustration below uses the federal cap.
| Loan amount | Term | Cost per $100 | Cost of borrowing | Total repayable | Approx. APR |
|---|---|---|---|---|---|
| $500 | 14 days | $14 | $70 | $570 | 365% |
Other limits
- Maximum payday loan amount: $1,500.
- Provinces with a payday lending regime: AB, BC, MB, NB, NL, NS, ON, PE, SK.
- Quebec does not permit payday lending; the maximum rate of credit there is 35% per year.
- The territories have no payday regime, so the federal 35% APR applies.
Source: Criminal Interest Rate Regulations: SOR/2024-114 — Government of Canada (Canada Gazette, Part II). Retrieved 2026-09-16.
Source: FCAC — Payday loans — Financial Consumer Agency of Canada. Retrieved 2026-09-16.
Sources
- Criminal Interest Rate Regulations: SOR/2024-114 — Government of Canada (Canada Gazette, Part II)
- FCAC — Payday loans — Financial Consumer Agency of Canada
- Criminal Code, s. 347 — Criminal interest rate — Government of Canada — Justice Laws
Frequently asked questions
What is the maximum a payday lender can charge in Canada?
$14 per $100 borrowed in provinces with a payday lending regime, plus a dishonoured-payment fee of no more than $20.
Is payday lending legal in Quebec?
No. Quebec does not permit payday lending. The maximum rate of credit in Quebec is 35% per year.
How much can I borrow with a payday loan?
The maximum payday loan amount nationally is $1,500. Some provinces also limit the loan to a share of your net pay.
Important legal information
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