All across the world, people ask what is a payday loan and if they are allowed to get one. Each country, and in our neighbor to the south each state has its own rules about payday loans. That’s what can make matters so complicated. Today, we’re talking about the laws regarding payday loans in Canada and what you should know if you are thinking about getting one.
What is a Payday Loan?
To begin talking about the legality behind a payday loan, we must first talk about what it is. If you take out a short term loan, chances are you are taking out a type of payday loan. Compared to a long-term loan, these types of loans are usually reserved for emergencies and are paid back within a relatively short period of time.
When borrowing, you will be expected to pay the loan back either from your next paycheck or throughout the next two or three paychecks. If you do not, you may face more considerable fees which can impact your overall debt level.
That’s why fast cash loans are meant to cover shortfalls should an unexpected event happen. For example, an emergency furnace replacement during the cold Canadian winter or car repair that was required for you to keep your job are ways these types of loans are often used.
What Laws Surround Payday Loans?
Each province and territory has different rules regarding payday lenders. Make sure that any online loan institution you choose is licensed in your area and follows the provincial regulations that protect you as the borrower. To summarize what could be a complicated list, we’ve gathered all major rules by province, just look for yours to find out what is and is not allowed.
| Province | Maximum Cost of Borrowing $100 for two weeks | Cooling off period to cancel the loan | Maximum penalty for returned cheque or failed pre-authorized debit | No forms for directly transferring wages | No extensions or roll overs on your loan | Further provincial specific laws |
| Alberta | $15 | 2 Business Days | $25 | Yes | Yes | Yes |
| British Columbia | $15 | 2 business days | $20 | Yes | Yes | Yes |
| Manitoba | $17 | 48 hours, excluding Sundays and holidays | $20 | Yes | Yes | |
| New Brunswick | $15 | 48 hours, excluding Sundays and holidays | $40 (default penalty) | Yes | Yes | |
| Nova Scotia | $19 | Next business day | $40 (default penalty) | Yes | Yes | Yes |
| Ontario | $15 | 2 business days | N/A | Yes | Yes | Yes |
| Prince Edward Island | $25 | 2 business days | N/A | |||
| Saskatchewan | $17 | Next business day | $25 | Yes | Yes | Yes |
What is iCash
iCASH is a Canadian online payday loan lender that is changing the face of cash advances and short term loans. Rather than complicated qualification requirements and high credit scores, iCASH offers a quick online application that gives you a yes or no answer right there. Safe, reliable loans from a direct lender that’s licensed in each province that they operate in. Get the money you need without the debt trap that’s often associated with other payday lenders.