Payday loans are unsecured short-term loans for a few hundred dollars. The average payday loan is around $290 for a period of 11 days. Payday loans are specifically designed to help customers with unanticipated expenses. Payday loans are part of the growing alternative consumer credit market in Canada and are offered by lenders other than banks or other regulated financial institutions.

The payday loan industry first emerged in Canada in the mid 1990s in response to a consumer demand for short term, small loans. Since the mid 90s, the payday loan industry in Canada has grown rapidly to an estimated 1,350 retail outlets across our country.

Salary advances from employers are less available today because of outsourcing of payroll processing and the use of direct deposit. Prior to the emergence of the payday loan industry, consumers had to turn to their friends and family to borrow small sums of money, or, if this personal network was unavailable or inappropriate, to alternative lenders with onerous lending conditions. Consumers with less than perfect credit looking to borrow very small amounts of money for short periods of time have had limited options. These types of unsecured loans are typically unavailable through banks or other financial institutions. Payday Loan is the perfect solution to help with these cash emergencies.

The amount you can borrow is usually limited to 40 percent of the net amount of your pay cheque. For example, if your pay cheque is $1,000 net every two weeks, your payday loan could be for a maximum of $400($1,000 x 40%).Payday loan customers are average Canadians with near-median household incomes. Fifty-three (53) percent are women, 47 percent are men. Nearly 2.5 million Canadians a year use payday loan services. To qualify for a payday loan, you must be employed and have a bank account.

Payday lenders are not currently members of the main credit-reporting agencies, getting a payday loan and paying it off on time will not improve your credit score. However, if you do not pay your loan back on time and it is sent to a collection agency, this will likely be reported to a credit-reporting