E-transfer payday loans are payday loans that are paid out by Interac e-Transfer instead of a cheque or a cash pickup. It is now the most common way online lenders in Canada fund loans, because the money moves between Canadian banks within minutes in most cases.
How e-Transfer funding works
When you sign your agreement, the lender sends an Interac e-Transfer to the email address or mobile number you registered with your bank. What happens next depends on your settings:
- Autodeposit on: the money goes straight into your account. You get a notice from your bank.
- Autodeposit off: you get an email or text and accept the transfer in your banking app. If there is a security question, the lender gives you the answer separately.
What affects how fast the money arrives
| Factor | Why it matters |
|---|---|
| Time you apply | Lenders fund during business hours. Applications late in the evening or on a holiday are often funded the next business day. |
| Bank verification | If your bank connection fails, the lender may need to check documents by hand. |
| Your bank’s security review | Banks sometimes hold a first transfer from a new sender for review. |
| Transfer limits | Your bank sets limits on incoming e-Transfers. Large amounts can be split. |
Set up autodeposit before you apply
In your banking app, look for Interac e-Transfer settings and register your email or phone number for autodeposit. It takes a few minutes and means you will not miss the transfer notice in a spam folder.
How you repay an e-Transfer payday loan
Repayment is almost always by pre-authorized debit from the same account on your payday. Make sure your pay lands before the debit date. If you know you will be short, call the lender before the due date. In Ontario, if this is your third loan within 63 days, the lender must offer you an extended payment plan.
E-Transfer loan scams
Some fake lenders reverse the process and ask you to send them an e-Transfer as a deposit, insurance or verification fee. No licensed payday lender in Canada does this. If anyone asks you to send money to receive a loan, stop and report it to the Canadian Anti-Fraud Centre.