How to Qualify for a Payday Loan in Canada

Dealing with unexpected expenses that crop up in the middle of the month can be difficult, but payday loans can help.

With the right payday loan, borrowers can access anywhere between $120 to $1,500 to help manage a financial emergency or bill payment. Borrowers can easily apply online or in person at a brick-and-mortar payday loan center. In most cases, they will receive the funds the same day (for online applications) or within just a few minutes (for in-person applications).

Curious about who can qualify for a payday loan in Canada? Read on to learn more.

Payday loan eligibility

One key factor that separates payday loans from traditional personal loans, credit cards, or secured bank loans is their inclusive eligibility criteria. Here are some common eligibility factors for applicants to consider.

• Applicant’s age: Payday lenders issue loans to applicants who are at least eighteen years old. Applicants can provide identification that indicates their age, such as a driver’s license or passport.
• Income: Applicants must receive wages from a job or have some other form of steady income. Payday lenders will require proof of verifiable income as part of the application. People with jobs can provide pay stubs, while people with other forms of income may be able to provide a bank statement.
• Bank account: Payday loan applicants need to have a chequing account, and there are a few reasons for this. People borrowing online receive the borrowed funds as a direct deposit. When it comes to repayment, it does not matter whether a borrower has applied online or in person – they typically authorize the lender to withdraw the amount from their chequing account on their next payday.

While bank loans may require applicants to meet salary or credit score requirements, these factors do not affect a payday loan application. This makes payday loans accessible to a wide range of people across Canada. That said, some issues may interfere with a payday loan application. Consider the following factors.

• Inconsistent income: Freelancers or business owners may not be able to meet the income requirements that most payday lenders have. While freelance workers can earn exceptionally well on one-off projects, many may not make a steady enough monthly income to qualify for a payday loan.
• An existing payday loan: Most payday lenders only issue one payday loan at a time. Applicants who already have an unpaid loan may not be eligible to borrow another loan even if they’re well below the borrowing limit.

The bottom line

Payday loans are a reliable last-minute source of funding for many people. However, as with most loans, not everyone may meet a lender’s credit criteria. Most payday lenders require applicants to be 18 or over, to have a verifiable income, and to have a chequing account. Applicants must also provide a copy of their government ID to apply for the loan.

Still uncertain about qualifying for a payday loan? Contact the lender’s customer service team to learn more about their eligibility.