Payday loans in Ontario: the rules, the limits and your rights
Ontario has more people borrowing payday loans than any other province, and some of the most detailed protections. It’s worth knowing them before you sign, because several only work if you use them, such as the two-day cancellation right and the extended payment plan.
Reviewed November 2026 by the Jessica’s House editorial team against federal and provincial lending rules. About 4 minutes to read.
Short answer
Payday loans in Ontario are regulated by the Payday Loans Act, 2008. A licensed lender can charge at most $14 per $100 borrowed, lend no more than 50% of your net pay per loan, up to $1,500, for no longer than 62 days. You can cancel within two business days at no cost, and a third loan within 63 days must come with an extended payment plan.
| Cost cap | $14 per $100 borrowed, including every fee |
|---|---|
| Loan limit | 50% of your net pay per loan, and no more than $1,500 |
| Longest term | 62 days |
| Cooling-off period | 2 business days to cancel, with no reason and no fee |
| Third loan in 63 days | Lender must offer an extended payment plan |
| Rollovers | Not allowed. No new loan from the same lender until the first is repaid |
| Default interest | At most 2.5% a month on the overdue amount, not compounded |
| Bounced payment fee | One fee of up to $20 per dishonoured payment |
| Collections | No more than 3 contacts in 7 days about a missed payment; never via your employer |
How much can you borrow in Ontario?
The lender must work out your net pay for the period of the loan and can lend you at most half of it. If you take home $1,500 every two weeks, your ceiling is $750. If you’re paid weekly and take home $700, it’s $350. It doesn’t matter how much you ask for. And $1,500 is the absolute maximum, whatever you earn.
Lenders can offer less than the limit, and first-time borrowers often get less. That’s not a bad thing. The loan comes out of your next paycheque in one piece, so the less you borrow, the less you’ll be short next time.
What a $600 Ontario payday loan costs
Borrowed for 14 days at the legal maximum: $84 in cost, $684 repaid. Cancel on day one or day two and you pay back just the $600.
The extended payment plan: Ontario’s brake on repeat borrowing
If you take out three payday loans with the same lender within 63 days, the third agreement has to let you repay in instalments instead of a lump sum. The plan’s shape depends on how often you’re paid:
- Paid weekly, every two weeks or twice a month: at least three instalments, each no more than 35% of the total owed.
- Paid monthly: at least two instalments, each no more than 50%.
You can pay the balance early and leave the plan at any time, with no penalty. If you find you need this plan, though, treat it as a signal. Three loans in two months usually means the shortfall is a budget gap, not a one-off. A free conversation with a non-profit credit counsellor will do more than a fourth loan.
Cancelling an Ontario payday loan
You have two business days after signing to cancel for any reason. Tell the lender in writing, by email or through its portal, and return the full amount you received. The lender has to refund anything it took and can’t charge you a fee. Weekends and holidays don’t count. If you sign on a Friday, you have until the end of Tuesday.
In some cases you can cancel after the two days, for example if the lender didn’t give you the required disclosures or a copy of your agreement. If you think a lender broke the rules, ask Consumer Protection Ontario what you’re entitled to.
Payday loan guides for Ontario cities
The rules are the same everywhere in the province, but the help available before you borrow isn’t. Each city guide lists who delivers Ontario Works locally, which utility runs your LEAP emergency program, and the local pay patterns that affect your due date.
- TorontoHigh rents, gig income and TTC-commute pay schedules
- OttawaPublic service pay issues and the Gatineau border
- MississaugaAirport, warehouse and shift-work pay schedules
- BramptonTrucking income, newcomers and larger households
- HamiltonSteel, hospital and university pay cycles
- LondonHealth care, students and a big rental market
- MarkhamTech, contract work and small business owners
- VaughanConstruction trades and seasonal work
- KitchenerManufacturing, tech and fast-rising rents
- WindsorAuto plant shutdowns and cross-border paycheques
- Richmond HillCommuter households with high fixed costs
- OakvilleAuto assembly, service jobs and high housing costs
- BurlingtonRetirees, commuters and fixed incomes
- OshawaAuto assembly, students and Durham commuters
- Greater SudburyMining rotations and winter heating bills
- BarrieHighway 400 commuters and tourist seasons
- GuelphManufacturing, agri-food and the university
- CambridgeAuto assembly and the 401 logistics corridor
- WhitbyYoung families and new subdivisions
- St. CatharinesTourism, wineries and seasonal hours
- KingstonMilitary postings, students and public institutions
- MiltonWarehouses, GO commuters and new families
- AjaxCommuters and shift workers on the Durham waterfront
- WaterlooCo-op students and the tech sector
Free help in Ontario before you borrow
- Ontario Works emergency assistance can help with an urgent cost if you have low income, even if you don’t receive monthly Ontario Works.
- The Ontario Electricity Support Program (OESP) gives eligible low-income households a monthly credit on their hydro bill.
- The Low-income Energy Assistance Program (LEAP) offers one-time grants toward overdue electricity or natural gas bills, through your utility.
- 211 Ontario connects you with food banks, rent banks and local programs by phone, text or chat, 24 hours a day.
- Non-profit credit counselling, through agencies accredited by Credit Counselling Canada, is free and confidential.
Ontario payday loan questions
What is the maximum payday loan in Ontario?
$1,500, or 50% of your net pay for the loan period, whichever is lower. A lender may offer less.
How much does a payday loan cost in Ontario?
At most $14 per $100 borrowed. A $500 loan costs at most $70, so you repay $570. Over 14 days, that’s an annual percentage rate of about 365%.
Can I have two payday loans at once in Ontario?
Not from the same lender. A lender can’t give you a new payday loan until the existing one is repaid. Taking loans from several lenders at once is legal but risky, and many lenders will check.
Can a payday lender call my employer in Ontario?
A lender can contact your employer only to confirm your employment before lending. It can’t contact your employer, family or friends to collect, or contact you more than three times in seven days about a missed payment.
What happens if I can’t repay an Ontario payday loan?
Call the lender before the due date. If the payment fails, the lender can charge one dishonoured-payment fee of up to $20 and interest of up to 2.5% a month on the overdue amount. After that, the debt may be sent to a collection agency, which can affect your credit report.
Apply with Ontario-licensed lenders
See your cost and due date before you sign, with two business days to change your mind.
Start my Ontario application Read our borrowing checklist first