How much can I borrow?

Two limits apply to every payday loan in Ontario, and the smaller of the two is the one that governs.

Limit one: $1,500

A payday loan is $1,500 or less, for 62 days or less. We lend up to $1,500, for up to 30 days, or for 61 days. Above $1,500 a loan stops being a payday loan at all — the federal exemption that lets payday lenders charge what they charge only covers advances of $1,500 or less, on a term of 62 days or less. Any Ontario lender offering you $2,000 as a “payday loan” is offering you something else, under different rules and usually at a different price.

Limit two: half your net pay

This is the limit that actually binds for most people. A single payday loan may not advance you more than 50% of your net pay for the pay period the loan runs across.

Net pay means what actually reaches your account: your gross income for the period less deductions at source — income tax, CPP, EI, union dues and the like. Not your salary on paper, and not what you take home in a good month with overtime.

Some worked examples:

• You are paid $1,000 net every two weeks. The most you can be advanced is $500.
• You are paid $1,600 net every two weeks. The ceiling is $800.
• You are paid $2,400 net twice a month. The ceiling is $1,200.
• You are paid $3,400 net monthly. Half is $1,700, but we lend up to $1,500, so $1,500 is the most you can have.

You have to earn over $3,000 net in the period before $1,500, the most we lend, is the binding limit. Below that, your income sets the limit.

Why the rule exists

Because a loan you cannot repay out of one pay period is a loan that turns into three. Capping the advance at half your net pay leaves the other half for rent, groceries and everything else that does not stop because you borrowed money. It is a blunt instrument and it is meant to be.

When your term is longer than one pay period

An Ontario payday loan cannot come due before your next regular income date. A payday loan is for 62 days or less, and we lend for up to 30 days, or for 61 days. If you are paid monthly, the loan naturally runs about a month; the 50% test is applied against that monthly net pay.

We may offer you less than the maximum

The limits above are the most you can have. What we can approve is a separate question, and it comes out of the assessment: how regular your income is, what your account looks like over the last several pay cycles, and what you are already committed to. All credit welcome — approval is based on your income and banking history. No lender that actually assesses applications can promise you a particular amount before it has looked.

Asking for less than the maximum is often the better move. The cost of borrowing scales exactly with the amount: $14 per $100, every time. Borrowing $400 instead of $700 saves you $42, and it is $342 less to find on your next payday.

Before you decide on a number

Work backwards, not forwards. Take your next net pay, subtract the rent, the bills and the food you already know are coming, and see what is genuinely left to repay a loan with. The figure the calculator on our rates and fees page shows you is the total that has to come out of that pay — cost of borrowing included.