Payday Loan Rollover Calculator
This calculator shows the total fees you pay when a payday loan is rolled over, and why the principal never falls. The default $14 per $100 is the federal cap — edit it to match any provincial rule or lender.
How this calculator works
A payday loan is repaid in a single payment on your next payday. If you cannot repay it, the lender may roll it over: you pay the fee again and the loan continues for another term. The key point is that the fee is charged each time, but the amount you borrowed — the principal — does not fall. After several rollovers you have paid the fee many times and still owe the original amount.
Formula: feePerPeriod = amount × feePer100 ÷ 100, totalFeesPaid = feePerPeriod × rollovers, and the amount still owed stays at amount. To clear the loan now costs amount + feePerPeriod. The effective annual rate of the fees is (totalFeesPaid ÷ amount) × (365 ÷ (days × rollovers)) × 100. The comparison line shows what borrowing the same amount at the alternative rate for the same number of days would cost in interest: amount × (alternativeRatePct ÷ 100) × (days × rollovers) ÷ 365.
The default fee is $14 per $100, the federal cap, but provincial caps vary and Quebec effectively bans payday loans. The default alternative rate is an example you can edit.
Rolling over is the expensive part of payday credit: the cash cost repeats while the debt stays the same. Before rolling over, ask the lender for a payment extension, or compare a line of credit, overdraft protection, a credit-card cash advance, a credit-union loan, or a payment arrangement with the biller.
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Frequently Asked Questions
What does rolling over a payday loan mean?
You pay the fee again and the loan continues for another term instead of being repaid. The principal stays the same, so the fee repeats without reducing the debt.
Why does the principal never fall?
A rollover only pays the fee. The amount borrowed is carried forward, so you still owe the full original amount after each rollover.
What is the federal cap on the fee?
The federal cap is $14 per $100 borrowed. Some provinces set a lower cap, and Quebec effectively bans payday loans.
How much does rolling over cost in total?
The fee per period multiplied by the number of rollovers. At $14 per $100 on a $300 loan, each rollover costs $42, so three rollovers cost $126 while you still owe $300.
What is a cheaper alternative?
A payment arrangement with the biller, overdraft protection, a line of credit, a credit-card cash advance, or a credit-union loan are usually cheaper. Ask for an extension before rolling over.
Last updated: September 16, 2026 · By the Instalment.ca Editorial Team
We research Canadian lending rules and update these pages when the law, the data, or the available offers change. We are not a lender and we do not provide personal financial advice.
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This is general information, not financial, legal, or tax advice.
Rates and terms vary by lender, creditworthiness, and province. Figures shown are examples only.