UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
D.C. 20549


_______________




FORM
10-Q


_______________




x
              QUARTERLY
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934




For
the quarterly period ended May 31, 2009




o
              TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the transition period from
______to______.




PAY
BY THE DAY HOLDINGS, INC.


(Exact
name of registrant as specified in Charter




NEVADA
              
              333-149552(State
      or other jurisdiction of
                incorporation
      or organization)
              
              (Commission
      File No.)
              
              (IRS
      Employee Identification No.)





3651
Lindell Rd. Suite D155


Las
Vegas, NV, 89103


(Address
of Principal Executive Offices)


_______________




1-800-854-7970


(Issuer
Telephone number)


_______________







193
Jardin Drive, 2nd Floor West


Concord,
ON L4K 1X5


(Former
Name or Former Address if Changed Since Last Report)




Check
whether the issuer (1) has filed all reports required to be filed by Section 13
or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the issuer was required to file such reports), and (2)has been
subject to such filing requirements for the past 90 days. Yes x  No
o





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).
Yes  No 




Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company filer.
 See definition of “accelerated filer” and “large accelerated filer” in
Rule 12b-2 of the Exchange Act (Check one):




Large
Accelerated Filer o     Accelerated
Filer o     Non-Accelerated
Filer o     Smaller
Reporting Company x




Indicate
by check mark whether the registrant is a shell company as defined in Rule 12b-2
of the Exchange Act. Yes x  No
o




State the
number of shares outstanding of each of the issuer’s classes of common equity,
as of July 20, 2009: 619,000 shares of common stock.









PAY
BY THE DAY




FORM
10-Q




May
31, 2009




INDEX




PART
I-- FINANCIAL INFORMATION




Item
      1.
            Financial
      StatementsItem
      2.
            Management’s
      Discussion and Analysis of Financial ConditionItem
      3.
            Quantitative
      and Qualitative Disclosures About Market RiskItem
      4T
            Control
      and Procedures




PART
II-- OTHER INFORMATION




Item
      1
            Legal
      ProceedingsItem
      1A
            Risk
      FactorsItem
      2.
            Unregistered
      Sales of Equity Securities and Use of ProceedsItem
      3.
            Defaults
      Upon Senior SecuritiesItem
      4.
            Submission
      of Matters to a Vote of Security HoldersItem
      5.
            Other
      InformationItem
      6.
            Exhibits
      and Reports on Form 8-K




SIGNATURE












Item
1. Financial Statements







PAY
BY THE DAY HOLDINGS, INC. AND SUBSIDIARY





(A
Development Stage Company)














CONSOLIDATED
FINANCIAL STATEMENTS


Unaudited
- See Review Engagement Report




31 MAY
2009





INDEX TO FINANCIAL
STATEMENTS





F-2
                  CONSOLIDATED
      BALANCE SHEETSF-3
                  CONSOLIDATED
      STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSSF-4
                  CONSOLIDATED
      STATEMENTS OF CASH
FLOWS




















Item
1.     Financial
Statements




PAY
BY THE DAY HOLDINGS, INC. AND SUBSIDIARY


(A
Development Stage Company)




CONSOLIDATED
FINANCIAL STATEMENTS


Unaudited
- See Review Engagement Report




31
MAY 2009











F1






PAY
BY THE DAY HOLDINGS, INC. AND SUBSIDIARY
  (A
Development Stage Company)




CONSOLIDATED
BALANCE SHEETS




AS
AT




(Expressed
in United States Dollars)




31
      May 2009 (Unaudited)
                    
                    
                    31
      August 2008 (Audited)ASSETSCurrent
      AssetsCash
                    
                    $
                    
                    
                    
                    $
                    22Short
      term investments, at fair value (cost - $5,405)
                    
                    
                    30
                    
                    
                    
                    15Prepaid
      and sundry assets
                    
                    
                    -
                    
                    
                    
                    1,514Total
      Current Assets
                    
                    
                    30
                    
                    
                    
                    1,551Long
      Term AssetsEquipment
                    
                    
                    5,470
                    
                    
                    
                    5,841Total
      Assets
                    
                    $
                    5,500
                    
                    
                    $
                    7,392LIABILITIES
      AND STOCKHOLDERS' DEFICITCurrent
      LiabilitiesBank
      Indebtedness
                    
                    
                    11Accounts
      payable and accrued liabilities
                    
                    $
                    43,774
                    
                    
                    $
                    28,010Advances
      from shareholder
                    
                    
                    14,349
                    
                    
                    
                    18,675Advances
      from related party
                    
                    
                    114,111
                    
                    
                    
                    72,654Total
      Current Liabilities
                    
                    
                    172,245
                    
                    
                    
                    119,339Total
      Liabilities
                    
                    
                    172,245
                    
                    
                    
                    119,339Stockholders'
      DeficitCapital
      stock, $0.001 par value; Authorized 100,000,000; issued and outstanding
      619,000  at 31 May 2009 (31 August, 2008 -
    619,000)
                    
                    
                    619
                    
                    
                    
                    619Additional
      paid-in capital
                    
                    
                    36,531
                    
                    
                    
                    36,531Accumulated
      other comprehensive loss
                    
                    
                    (4,801
                    )
                    
                    
                    (6,483
                    )Deficit
      accumulated during the development stage
                    
                    
                    (199,094
                    )
                    
                    
                    (142,614
                    )Total
      Stockholders' Deficit
                    
                    
                    (166,745
                    )
                    
                    
                    (111,947
                    )Total
      Liabilities and Stockholders' Deficit
                    
                    $
                    5,500
                    
                    
                    $
                    7,392







The
accompanying notes are an integral part to these financial
statements.
 F2









PAY
BY THE DAY HOLDINGS, INC. AND SUBSIDIARY
  (A
Development Stage Company)


CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS




(Unaudited)




(Expressed
in United States Dollars)




For
      the Three Months Ended 31 May 2009
                                                                                      
                                                                                      
                                                                                      For the Three
      Months Ended 31 May 2008
                                                                                      
                                                                                      
                                                                                      For
      the Period from Inception (5 June 2003) to 31 May 2009SALES
                                                                                      
                                                                                      
                                                                                      1,585
                                                                                      
                                                                                      
                                                                                      
                                                                                      1,192
                                                                                      
                                                                                      
                                                                                      
                                                                                      379,003COST
      OF GOODS SOLD
                                                                                      
                                                                                      
                                                                                      501
                                                                                      
                                                                                      
                                                                                      
                                                                                      515
                                                                                      
                                                                                      
                                                                                      
                                                                                      262,975GROSS
      PROFIT
                                                                                      
                                                                                      
                                                                                      1,084
                                                                                      
                                                                                      
                                                                                      
                                                                                      677
                                                                                      
                                                                                      
                                                                                      
                                                                                      116,028EXPENSESProfessional
      fees
                                                                                      
                                                                                      
                                                                                      3,740
                                                                                      
                                                                                      
                                                                                      
                                                                                      12,354
                                                                                      
                                                                                      
                                                                                      
                                                                                      197,719Office
      and general
                                                                                      
                                                                                      
                                                                                      649
                                                                                      
                                                                                      
                                                                                      
                                                                                      158
                                                                                      
                                                                                      
                                                                                      
                                                                                      34,120Telecommunications
                                                                                      
                                                                                      
                                                                                      1,029
                                                                                      
                                                                                      
                                                                                      
                                                                                      1,161
                                                                                      
                                                                                      
                                                                                      
                                                                                      30,311Advertising
      and promotion
                                                                                      
                                                                                      
                                                                                      44
                                                                                      
                                                                                      
                                                                                      
                                                                                      110
                                                                                      
                                                                                      
                                                                                      
                                                                                      31,565Vehicle
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      904Interest
      and bank charges
                                                                                      
                                                                                      
                                                                                      69
                                                                                      
                                                                                      
                                                                                      
                                                                                      446
                                                                                      
                                                                                      
                                                                                      
                                                                                      16,375Salaries
      and wages
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      962
                                                                                      
                                                                                      
                                                                                      
                                                                                      -Travel
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      20
                                                                                      
                                                                                      
                                                                                      
                                                                                      -Rent
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      27,682Bad
      debts
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      9,774Depreciation
                                                                                      
                                                                                      
                                                                                      388
                                                                                      
                                                                                      
                                                                                      
                                                                                      341
                                                                                      
                                                                                      
                                                                                      
                                                                                      13,943TOTAL
      OPERATING EXPENSES
                                                                                      
                                                                                      
                                                                                      5,919
                                                                                      
                                                                                      
                                                                                      
                                                                                      15,552
                                                                                      
                                                                                      
                                                                                      
                                                                                      362,393LOSS
      FROM OPERATIONS
                                                                                      
                                                                                      
                                                                                      (4,835
                                                                                      )
                                                                                      
                                                                                      
                                                                                      (14,875
                                                                                      )
                                                                                      
                                                                                      
                                                                                      (246,365
                                                                                      )Realized gain on disposal of available-for-sale securities
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      1,789Foreign exchange gain (loss)
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      (6
                                                                                      )
                                                                                      
                                                                                      
                                                                                      17,293Gain on extinguishment of debt
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      19,126Loss
      on disposal of assets
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      (2,762
                                                                                      )Interest
      income
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      11,821NET
      LOSS
                                                                                      
                                                                                      $
                                                                                      (4,835
                                                                                      )
                                                                                      
                                                                                      $
                                                                                      (14,881
                                                                                      )
                                                                                      
                                                                                      $
                                                                                      (199,098
                                                                                      )Foreign
      currency translation adjustment
                                                                                      
                                                                                      
                                                                                      (19,990
                                                                                      )
                                                                                      
                                                                                      
                                                                                      1,148
                                                                                      
                                                                                      
                                                                                      
                                                                                      (4
                                                                                      )Unrealized
      loss on available-for-sale securities, net of tax
                                                                                      
                                                                                      
                                                                                      25
                                                                                      
                                                                                      
                                                                                      
                                                                                      -
                                                                                      
                                                                                      
                                                                                      
                                                                                      (4,797
                                                                                      )COMPREHENSIVE
      LOSS
                                                                                      
                                                                                      $
                                                                                      (24,800
                                                                                      )
                                                                                      
                                                                                      $
                                                                                      (13,733
                                                                                      )
                                                                                      
                                                                                      $
                                                                                      (203,899
                                                                                      )LOSS
      PER WEIGHTED NUMBER OF SHARES OUTSTANDING - BASIC AND
    DILUTED
                                                                                      
                                                                                      $
                                                                                      (0.03
                                                                                      )
                                                                                      
                                                                                      $
                                                                                      (0.02
                                                                                      )WEIGHTED
      AVERAGE NUMBER OF SHARES OUTSTANDING - BASIC AND DILUTED
                                                                                      
                                                                                      
                                                                                      619,000
                                                                                      
                                                                                      
                                                                                      
                                                                                      619,000







The
accompanying notes are an integral part to these financial
statements.
 F3







PAY
BY THE DAY HOLDINGS, INC. AND SUBSIDIARY
  (A
Development Stage Company)




CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS




(Unaudited)




(Expressed
in United States Dollars)





For
      the Nine Months Ended 31 May 2009
                                                              
                                                              
                                                              For
      the Nine Months Ended 31 May 2008SALES
                                                              
                                                              
                                                              3,279
                                                              
                                                              
                                                              
                                                              3,377COST
      OF GOODS SOLD
                                                              
                                                              
                                                              2,009
                                                              
                                                              
                                                              
                                                              2,154GROSS
      PROFIT
                                                              
                                                              
                                                              1,270
                                                              
                                                              
                                                              
                                                              1,223EXPENSESProfessional
      Fees
                                                              
                                                              
                                                              45,979
                                                              
                                                              
                                                              
                                                              65,155Office
      and general
                                                              
                                                              
                                                              2,185
                                                              
                                                              
                                                              
                                                              507Telecommunications
                                                              
                                                              
                                                              3,302
                                                              
                                                              
                                                              
                                                              3,116Advertising
      and Promotion
                                                              
                                                              
                                                              1,189
                                                              
                                                              
                                                              
                                                              190Vehicle
                                                              
                                                              
                                                              196
                                                              
                                                              
                                                              
                                                              -Interest
      and bank charges
                                                              
                                                              
                                                              264
                                                              
                                                              
                                                              
                                                              1,223Salaries
      and wages
                                                              
                                                              
                                                              -
                                                              
                                                              
                                                              
                                                              3,043Travel
                                                              
                                                              
                                                              -
                                                              
                                                              
                                                              
                                                              20Freight
      and delivery
                                                              
                                                              
                                                              -
                                                              
                                                              
                                                              
                                                              30Depreciation
                                                              
                                                              
                                                              1,110
                                                              
                                                              
                                                              
                                                              966TOTAL
      OPERATING EXPENSES
                                                              
                                                              
                                                              54,225
                                                              
                                                              
                                                              
                                                              74,250LOSS
      FROM OPERATIONS
                                                              
                                                              
                                                              (52,955
                                                              )
                                                              
                                                              
                                                              (73,027
                                                              )Foreign
      exchange loss
                                                              
                                                              
                                                              (3,533
                                                              )
                                                              
                                                              
                                                              (470
                                                              )Interest
      income
                                                              
                                                              
                                                              4
                                                              
                                                              
                                                              
                                                              467NET
      LOSS
                                                              
                                                              $
                                                              (56,484
                                                              )
                                                              
                                                              $
                                                              (73,030
                                                              )Foreign
      currency translation adjustment
                                                              
                                                              
                                                              1,670
                                                              
                                                              
                                                              
                                                              (4,159
                                                              )Unrealized
      loss on available-for-sale securities, net of tax
                                                              
                                                              
                                                              12
                                                              
                                                              
                                                              
                                                              -COMPREHENSIVE
      LOSS
                                                              
                                                              $
                                                              (54, 802
                                                              )
                                                              
                                                              $
                                                              (77,189
                                                              )LOSS
      PER WEIGHTED NUMBER OF SHARES OUTSTANDING - BASIC AND
    DILUTED
                                                              
                                                              $
                                                              (0.09
                                                              )
                                                              
                                                              $
                                                              (0.14
                                                              )WEIGHTED
      AVERAGE NUMBER OF SHARES OUTSTANDING - BASIC AND DILUTED
                                                              
                                                              
                                                              619,000
                                                              
                                                              
                                                              
                                                              531,6200






The
accompanying notes are an integral part to these financial
statements.
 F4




PAY
BY THE DAY HOLDINGS, INC. AND SUBSIDIARY
  (A
Development Stage Company)




CONSOLIDATED
STATEMENTS OF CASH FLOWS




(Unaudited)




(Expressed
in United States Dollars)




For
      the Nine Months Ended 31 May 2009
                              
                              
                              For
      the Nine Months Ended 31 May 2008
                              
                              
                              For
      the Period from Inception (5 June 2003) to 31 May 2009CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      loss
                              
                              $
                              (56,484
                              )
                              
                              $
                              (73,030
                              )
                              
                              $
                              (199,098
                              )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Depreciation
                              
                              
                              1,110
                              
                              
                              
                              966
                              
                              
                              
                              13,943Loss
      on disposal of assets
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              2,762Issuance
      of common stock for services
                              
                              
                              -
                              
                              
                              
                              1,000
                              
                              
                              
                              1,000Changes
      in operating assets and liabilities:Prepaid
      and sundry assets
                              
                              
                              1,514
                              
                              
                              
                              (843
                              )
                              
                              
                              -Accounts
      payable and accrued liabilities
                              
                              
                              15,764
                              
                              
                              
                              13,445
                              
                              
                              
                              43,774Deferred
      taxes
                              
                              
                              -
                              
                              
                              
                              (92
                              )
                              
                              
                              -NET
      CASH USED IN OPERATING ACTIVITIES
                              
                              
                              (38,096
                              )
                              
                              
                              (58,554
                              )
                              
                              
                              (137,619
                              )CASH
      FLOWS FROM INVESTING ACTIVITIESAvailable-for-sale
      securities
                              
                              
                              (15
                              )
                              
                              
                              (49
                              )
                              
                              
                              (30)Disposition
      of equipment
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              4,462Acquisition
      of equipment
                              
                              
                              (735
                              )
                              
                              
                              (4,397
                              )
                              
                              
                              (26,633
                              )NET
      CASH USED IN INVESTING ACTIVITIES
                              
                              
                              (750
                              )
                              
                              
                              (4,446
                              )
                              
                              
                              (22,201
                              )CASH
      FLOWS FROM FINANCING ACTIVITIESBank
      advances
                              
                              
                              11
                              
                              
                              
                              -
                              
                              
                              
                              11Advances
      from shareholder
                              
                              
                              (4,326
                              )
                              
                              
                              (2,687
                              )
                              
                              
                              14,349Advances
      from related parties
                              
                              
                              41,457
                              
                              
                              
                              35,114
                              
                              
                              
                              114,111Issuance
      of common stock for cash
                              
                              
                              -
                              
                              
                              
                              35,900
                              
                              
                              
                              36,150NET
      CASH PROVIDED BY FINANCING ACTIVITIES
                              
                              
                              37,142
                              
                              
                              
                              68,327
                              
                              
                              
                              164,621EFFECT
      OF FOREIGN CURRENCY TRANSLATION
                              
                              
                              1,670
                              
                              
                              
                              (3,390
                              )
                              
                              
                              (4
                              )UNREALIZED
      LOSS ON AVAILABLE-FOR-SALE SECURITIES, NET OF TAX
                              
                              
                              12
                              
                              
                              
                              -
                              
                              
                              
                              (4,797
                              )NET
      (DECREASE) INCREASE IN CASH
                              
                              
                              (22
                              )
                              
                              
                              1,937
                              
                              
                              
                              -CASH,
      BEGINNING OF PERIOD
                              
                              
                              22
                              
                              
                              
                              154
                              
                              
                              
                              -CASH, END
      OF PERIOD
                              
                              $
                              -
                              
                              
                              $
                              2,091
                              
                              
                              $
                              -





The
accompanying notes are an integral part to these financial
statements.
 F5


PAY
BY THE DAY HOLDINGS, INC. AND SUBSIDIARY
  (A
Development Stage Company)


NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS




FOR
THE PERIOD FROM THE DATE OF INCEPTION (5 JUNE 2003) TO 31 MAY 2009




(Expressed
in United States Dollars)






1.    NATURE
OF OPERATIONS AND ORGANIZATION




Nature
of Operations




Pay by
the Day Company Inc. ("PBDC") was incorporated in Canada on 5 June 2003 and was
acquired by Pay by the Day Holdings, Inc. (the "Company" or "PBTD") on 31 August
2007. PBTD was incorporated in the State of Nevada on 31 August
2007.  The Company is a development stage company whose principal line
of business is selling computers and other electronic components through
telephone and web orders, which the company then finances through a third
party.




Organization




In August
2007, PBDC consummated a Share Exchange Agreement (the "Agreement"), whereby
100% of its shares were acquired by PBTD, a Nevada corporation, in exchange for
200,000 shares of PBTD.  As a result of the transaction, the former
shareholders of PBDC received 80% ownership of PBTD and the remaining 20% of
PBTD was already held by the sole shareholder of PBDC, Jordan
Starkman.  The merger was therefore accounted for as a
recapitalization of PBDC into a shell company.  PBTD assets and
capital were recorded at historical cost in the recapitalization accounting. The
transaction costs associated with the recapitalization were
immaterial.




The above
transaction has been accounted for as a reverse merger (recapitalization) with
PBDC  being deemed the accounting acquirer and PBTD being deemed the
legal acquirer.  Accordingly, the historical financial information
presented in the financial statements is that of PBDC (since 5 June 2003 the
date of inception) as adjusted to give effect to any difference in the par value
of the issuer’s and the accounting acquirer’s stock with an offset
to additional paid in capital.  The basis of the assets and
liabilities of PBDC, the accounting acquirer, has been carried over in the
recapitalization.  The terms of the Agreement were consummated on 31
August 2007 and PBTD now owns 100% of the equity interests of PBDC.




2.    BASIS
OF PRESENTATION




The
accompanying unaudited interim financial statements have been prepared in
accordance with accounting principles generally accepted in the United States of
America for interim financial information and the SEC instructions to Form 10-Q.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been
included.  Operating results for the three month period ended 31 May
2009 are not necessarily indicative of the results that may be expected for the
year ending 31 August 2009.  For further information, refer to the
financial statements and footnotes thereto included in the Company’s annual
report on Form 10-K for the year ended 31 August 2008.








F6


PAY
BY THE DAY HOLDINGS, INC. AND SUBSIDIARY
  (A
Development Stage Company)
  NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
  FOR
THE PERIOD FROM THE DATE OF INCEPTION (5 JUNE 2003) TO 31 MAY 2009
  (Expressed
in United States Dollars)





3.    RECENT
ACCOUNTING PRONOUNCEMENTS





In
March 2008, the FASB issued Statement No. 161, Disclosures about Derivative
Instruments and Hedging Activities(“SFAS 161”).  SFAS No.
161 expands the disclosure requirements in SFAS No. 133, Accounting for Derivative
Instruments and Hedging Activities about an entity’s derivative
instruments and hedging activities.  Adopted on March 1, 2009, we
currently have no derivatives and hedging activities and so the adoption of SFAS
No. 161 had no impact on our financial condition, results of
operations or cash flows.





In April
2009, FASB issued FSP No. 107-1/APB 28-1, Interim Disclosures about Fair Value
of Financial Instruments. Entities shall include disclosures about
the fair value of financial instruments whenever it issues summarized financial
information for interim reporting periods.  Entities shall disclose in
the body or in the accompanying notes of its summarized financial information
the fair value of all financial instruments for which it is practicable to
estimate that value, whether recognized or not recognized in the statement of
financial position, as required by Statement 107.  Effective for
interim periods ending after June 15, 2009, with early adoption permitted for
periods ending after March 15, 2009, this FSP was adopted and had no impact on
our financial condition, results of operations or cash flows.




In April
2009, FASB issued FSP No. 115-2 and FAS 124-2, Recognition and Presentation of
Other-Than-Temporary Impairments.  This FSP amends the
other-than-temporary impairment guidance in U.S. GAAP for debt securities to
make the guidance more operational and to improve the presentation and
disclosure of the other-than-temporary impairments on debt and equity securities
in the financial statements.  The FSP is effective for interim and annual
reporting periods ending after June 15, 2009.  We currently have no debt
securities and so had no impact on our financial condition, results of
operations or cash flows.




In May
2009, the FASB issued Statement No. 165, Subsequent Events (“SFAS
165”).  SFAS 165 requires entities to disclose the date through which
they have evaluated subsequent events and whether the date corresponds with the
release of their financial statements.  Effective for interim and
annual periods ending after June 15, 2009, SFAS 165 will become effective in the
next reporting quarter.  SFAS 165 should not have an impact on our
financial condition, results of operations or cash flows.




In June
2009, the FASB issued Statement No. 168, The FASB Accounting Standards
Codification and the Hierarchy of Generally Accepted Accounting
Principles (“SFAS 168”).  SFAS 168 will become the single
source of authoritative nongovernmental U.S. generally accepted accounting
principles (“GAAP”), superseding existing FASB, American Institute of Certified
Public Accountants (“AICPA”), Emerging Issues Task Force (“EITF”), and related
accounting literature.  SFAS 168 reorganizes the thousands of GAAP
pronouncements into roughly 90 accounting topics and displays them using a
consistent structure.  Also included is relevant Securities and
Exchange Commission guidance organized using the same topical structure in
separate sections.  SFAS 168 will be effective for financial
statements issued for reporting periods that end after September 15,
2009.  This will have an impact on the Company’s financial statements
since all future references to authoritative accounting literature will be
references in accordance with SFAS 168.




4.    GOING
CONCERN




These
consolidated financial statements have been prepared assuming the Company will
continue on a going-concern basis. The Company has incurred losses since
inception and the ability of the Company to continue as a going-concern depends
upon its ability to develop profitable operations and to continue to raise
adequate financing. Management is actively targeting sources of additional
financing to provide continuation of the Company’s operations. In order for
the Company to meet its liabilities as they come due and to continue its
operations, the Company is solely dependent upon its ability to generate such
financing.




F7





PAY
BY THE DAY HOLDINGS, INC. AND SUBSIDIARY
  (A
Development Stage Company)
  NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
  FOR
THE PERIOD FROM THE DATE OF INCEPTION (5 JUNE 2003) TO 31 MAY 2009
  (Expressed
in United States Dollars)




There can
be no assurance that the Company will be able to continue to raise funds, in
which case the Company may be unable to meet its obligations. Should the Company
be unable to realize its assets and discharge its liabilities in the normal
course of business, the net realizable value of its assets may be materially
less than the amounts recorded in these consolidated financial
statements.




The
consolidated financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts and classification
of liabilities that might be necessary should the Company be unable to continue
in existence.




5.     ADVANCES
FROM SHAREHOLDER




The
advances from shareholder were from the sole director and shareholder, Jordan
Starkman.  The amount as at 31 May 2009 of $14,349 (31 August 2008 -
$18,675) is non-interest bearing, unsecured and has no specific terms of
repayment.  The carrying value of the advances approximates the market
value due to the short-term maturity of the financial instruments.




6.     RELATED
PARTY TRANSACTIONS




The
transactions with related parties were in the normal course of operations and
were measured at the exchange value which represented the amount of
consideration established and agreed to by the parties. Related party
transactions not disclosed elsewhere in these consolidated financial statements
are as follows:




(a)
            Accrued
      or paid management fees to the spouse of Jordan Starkman, the sole
      director of the Company as at 31 May 2009  were $8,255 (31
      August 2008 - $16,755).




(b)
            Advances
      from a related company controlled by Jordan Starkman, the sole director of
      PBTD as at 31 May  2009 were $114,111 (31 August 2008 -
      $72,654). These advances are non interest bearing, unsecured and with no
      specific terms of repayment.




7.    SUPPLEMENTAL
CASH FLOW INFORMATION




During
the periods ended 31 May 2009 and 2008 and the period from inception to 31 May
2009, there were no interest or taxes paid by the Company.




F8








Item
2.     Management’s Discussion and Analysis or Plan of
Operation




Plan of
Operation




The  promotion
of PBTD CreditPlus is contingent upon  if we can successfully obtain
financing and will begin with the production of a new 30 second direct response
commercials. The campaign will be nationwide with multiple station coverage. We
are currently in discussions with a Canadian based media company to produce
an infomercial that will air on stations across Ontario. The cost of producing
and airing the infomercial is approximately $20,000. We expect the profits
generated from the infomercial campaign to fund additional air time slots.
PBTD anticipates the production of the infomercial and commercial to begin 6-8
months once the financing is obtained. We produced two 30 second spot
commercials in 2004 that aired Canada wide with a focus on Northern Ontario and
all of Alberta. The new television advertising campaign will be initiated with
the guidance of an advertising agency. We determine the areas of interest and
the agency provides us with various rates, time slots available, and the
stations catering to our focus area.





We  plan
to hire 2-3 additional sales people plus 1 administrative staff
member.  The hiring of additional staff will take place once the funds
are raised to advertise more aggressively. Depending on the number of incoming
calls to us and the success of the advertising campaign, we may also be required
to upgrade our phone system and upgrade our current database to allow for easier
access to customer files.  Currently, management is able to process
applications and handle the incoming calls with our current
resources.





We have
formed a relationship with Equifax. This allows us to process the credit files
and check customers credit scores ourselves prior to sending the application to
our third party finance service provider. The cost of running an Equifax file is
$10. This is an additional expense to the company that will be added into our
customer's purchases. We have also been approved by Equifax to report customer's
trade files to Equifax on a monthly basis. There is no fee associated
with reporting to Equifax.




The
fundamental concept of our business involves the granting of credit by either
our third party finance service provider or by PBTD internally.  Our
relationship with our third party finance service provider is one that will
hopefully expedite our growth process by providing an easy application process
with a high probability of customer approval rates.  They have the
ability to finance both A and B level credit on a Conditional Sales Contract
program or a 3 year lease contract.   A Conditional Sales
Contract is commonly known as buying on an installment plan and requires the
giving of a promissory note for the purchase price under the
contract.  It is a type of agreement to sell whereby a seller retains
title to the goods sold and delivered to a purchaser until full payment has
been made.  A conditional buyer has the right of possession of the
goods so long as the terms and conditions of the agreement are met.  A
Conditional Sales Contract is similar to a lease contract except at the end of
the term the buyer obtains ownership of the goods as soon as the final payment
to the seller is made.





We
receive 100% of the transaction amount on “A” credit deals and due to the added
risk for “B” credit customers, the payout is 90% of the transaction amount. For
example, if the purchase amount is $1,000, our third party service provider pays
us 100% of the $1,000 for an “A” credit customer. If the customer has “B” level
credit then the payout amount to us is 90% of the $1,000 transaction amount.
There is no recourse on transactions rated as an “A” credit deal, however we
have 1st payment recourse on “B” credit deals. Once the customer has made there
1st payment, we are no longer liable for the sale amount. We currently have no
exposure at this point in time. We are currently being funded on deals once the
merchandise has been shipped from our facilities and the customer acknowledges
receipt of goods. We currently have a 3-5 hour turn around time for approvals or
declines. We are not related to any of our service providers except for the
relationships described.




Our
business operation relies upon a third party service provider to approve for
credit and finance our customer’s purchases. If we encounter difficulty in
obtaining customer credit approvals for financing, the company’s business will
suffer. Due to our difficulty in obtaining credit approvals, we have reached an
agreement with Tanner Financial Services Inc. in July 2008 to accept and process
our customer applications.




We
believe the relationship with Tanner Financial will increase our approval rates
leading to increased sales, as they are a more aggressive lender willing to take
on additional risk by financing A, B, and C level credit customers. The terms
and conditions of the agreement with Tanner Financial are the same as previous
3rd party finance providers. Furthermore, the company has turned to
self-financing and has financed new/off-lease desktop computers and laptops, and
consumer electronics for customers willing to put down 50% of the total purchase
price of their order. The main selling features and the attractiveness of our
financing route is the 0% interest rate and the reporting of the trade to
Equifax on a monthly basis, allowing the customers who can afford the 50% down
to rebuild or reestablish credit history. The key component is the 50% down
payment, and we realize this financing option is not for everybody. The 50% down
payment can translate into a $200-$500 down payment which is significant for
customers who wish to pay for purchases on a payment plan and for those who
cannot afford to make purchases at their local store.




1




We
believe we can continue the operation of financing merchandise internally with a
limited amount of capital because the 50% down payment required by the customer
covers the majority of the cost of the merchandise.  We have limited
our exposure and risk in case of default by the customer, and there is limited
capital required to finance these purchases.  As we raise
additional capital, we will on a case-by-case basis determine if additional
risk is warranted based on the customer’s credit rating.




Results of
Operation





For the
period from inception through May 31, 2009, we had $379,003in revenue. Cost
of goods sold and operating expenses for the period from inception totaled
$262,975 and 362,393 respectively and our loss from operations was
$246,365 and our net loss was $199,098.





Revenue
for the Nine months period ended May 31, 2009 was $3,279compared to $3,377
for the Nine months period ended May 31, 2008. The revenue was generated
from the sale of computer and consumer electronics financed through a third
party service provider and financed by us.




Operating
expenses for the nine months period ended May 31, 2009 were
$54,225 compared to $74,250for the nine months period ended May 31,
2008. The decrease in operating expenses during the period ended May 31,
2009 compared to the period ended May31, 2008 is primarily attributed to
professional fees. Professional fees for the period ended May 31, 2009 were
$45,979 and $65,155for the period ended May 31, 2008. These fees paid in
the three months ended May 31, 2008 were attributable to legal, accounting,
consulting, and auditing services related to our listing process and quarterly
filings.





Net loss
was $56,484for the period ended May 31, 2009 and $173,030 for period ended
May 31, 2008. The decrease in operating expenses, specifically professional
fees during the period ended May 31, 2009 was the main contributing factor
for the decreased loss during the period.





The vast
majority of our sales consist of computer and electronic products financed
through our third party finance service provider and our internal financing
program.  The profit is generated from the margins on the products
sold.  We charge 0% interest on our internal financing and CreditPlus
card, and we do not have any interest charges revenue.  Service fees
revenue from our CreditPlus Card is nil.  We expect to generate
service fees revenue once our CreditPlus advertising campaign
begins.





We have
experienced a dramatic decrease in sales from fiscal year August 31, 2005 to
May 31, 2009.  Our slow growth and decrease in sales is
attributed to the difficulty in effectively approving customer credit
applications.  We have also been affected by the current credit market
conditions and as a result approval rates have decreased due to the poor credit
quality of customers applying for credit.




If our
3rd party finance providers increase the criteria for credit approvals or its
parameters for credit approvals, the increased restriction on credit approvals
will make customer applications more difficult to finance. In this situation, it
is uncertain if we will be able to continue to finance customer‘s purchases
through our third party service provider. We may have to enter into additional
agreements with multiple 3rd party finance providers, or increase the number of
transactions financed internally. Our decrease in sales from inception to date
is also attributed to the lack of advertising dollars to fully market the us and
our offerings. In addition, over the past two years there has been a significant
drop in the selling prices of computers and consumer electronics making these
goods easily accessible at local retailers without the need for customer
financing. Furthermore, the dramatic drop in retail prices of computers and
consumer electronics has reduced our profit margins.




Liquidity and Capital
Resources





As of
May 31, 2009 we had bank indebtedness of $11.





The
initial use of proceeds from our common share sales that occurred between
September 2007 and December 2007 was to be split between offering expenses,
professional fees, advertising/marketing, and working capital, with 60% of the
capital raised going towards advertising/marketing. We raised approximately
$26,000 from our intended maximum offering of $100,000 and exercised our right
to reassess and reassign our intended use of funds. We have has allocated almost
all of our capital raised for legal and accounting/auditor expenses related to
the offering and the listing process.




2






We are
currently seeking funding for our planned expansion and  would like to
raise a minimum of $200,000  in order to aggressively promote and
advertise our brand and CreditPlus program. To achieve our goals, a large
portion of the funds raised will be invested in advertising. Our success is
contingent upon our customers seeing our ads and calling our 1-800 phone number.
There is a distinct correlation between the number of dollars invested in
advertising and the number of sales made. The proceeds raised will also be used
to fund a greater portion of transactions through our internal financing
program. We expect to raise additional funds within the next 6-8 months. A
private placement is the most likely scenario for the company to achieve success
in raising additional funds for its operations. There are no discussions with
any parties at this point in time for additional funding; however, we will
attempt to discuss our business plan with various brokers in the
US.




We
believe we can satisfy our cash requirements for the next twelve months with our
expected revenues and if needed an additional loan from the our sole director,
Jordan Starkman. However, completion of our plan of operations is subject to
attaining adequate revenue. We cannot assure investors that adequate revenues
will be generated. In the absence of our projected revenues, we may be unable to
proceed with our plan of operations. Even without adequate revenues within the
next twelve months, we still anticipate being able to continue with our present
activities, but we may require financing to achieve our profit, revenue, and
growth goals.




We
anticipate that our operational, and general & administrative expenses for
the next 12 months will total approximately $15,000. The $15,000 will be
financed through our anticipated sales of approximately $15,000 plus if needed,
an advance from our sole director, Jordan Starkman. We do not anticipate the
purchase or sale of any significant equipment. We also do not expect any
significant additions to the number of employees, unless financing is raised.
The foregoing represents our best estimate of our cash needs based on current
planning and business conditions. The exact allocation, purposes and timing of
any monies raised in subsequent private financings may vary significantly
depending upon the exact amount of funds raised and our progress with the
execution of our business plan.





In the
event we are not successful in reaching our initial revenue targets, additional
funds may be required, and we may not be able to proceed with our business plan
for the development and marketing of our core services. Should this occur, we
would likely seek additional financing to support the continued operation of our
business. We anticipate that depending on market conditions and our plan of
operations, we may incur operating losses in the foreseeable future. Therefore,
our auditors have raised substantial doubt about our ability to continue as a
going concern.  We will need approximately $200,000 to aggressively
pursue and implement our growth goals through advertising.




Off-Balance SheetArrangements




We do not
have any outstanding derivative financial instruments, off-balance sheet
guarantees, interest rate swap transactions or foreign currency contracts. We do
not engage in trading activities involving non-exchange traded
contracts.




Item 3. Quantitative and Qualitative
Disclosures About Market Risk





We are
subject to certain market risks, including changes in interest rates and
currency exchange rates.  We do not undertake any specific actions to limit
those exposures.





Item
4T.  Controls and Procedures





Evaluation
of disclosure controls and procedures




Under the
supervision and with the participation of our management, including our
principal executive officer and principal financial officer, we conducted an
evaluation of our disclosure controls and procedures, as such term is defined
under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities
Exchange Act of 1934, as amended (Exchange Act), as of  May 31,
2009. Based on this evaluation, our principal executive officer and principal
financial officers have concluded that our disclosure controls and procedures
are effective to ensure that information required to be disclosed by us in the
reports we file or submit under the Exchange Act is recorded, processed,
summarized, and reported within the time periods specified in the
Securities and Exchange Commission’s rules and forms and that our disclosure and
controls are designed to ensure that information required to be disclosed by us
in the reports that we file or submit under the Exchange Act is accumulated and
communicated to our management, including our principal executive and principal
financial officers, or persons performing similar functions, as appropriate to
allow timely decisions regarding required disclosure.




3






MANAGEMENT’S
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING




Management
of the Company is responsible for establishing and maintaining effective
internal control over financial reporting as defined in Rule 13a-15(f) under the
Exchange Act. The Company’s internal control over financial reporting is
designed to provide reasonable assurance to the Company’s management and Board
of Directors regarding the preparation and fair presentation of published
financial statements in accordance with United State’s generally accepted
accounting principles (US GAAP), including those policies and procedures that:
(i) pertain to the maintenance of records that, in reasonable detail, accurately
and fairly reflect the transactions and dispositions of the assets of the
company, (ii) provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with US
GAAP and that receipts and expenditures are being made only in accordance with
authorizations of management and directors of the company, and (iii) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company’s assets that could have a
material effect on the financial statements.




Management
conducted an evaluation of the effectiveness of internal control over financial
reporting based on the framework in Internal Control—Integrated Framework issued
by the Committee of Sponsoring Organizations of the Treadway Commission.
Management’s assessment included an evaluation of the design of our internal
control over financial reporting and testing of the operational effectiveness of
our internal control over financial reporting. Based on this assessment,
Management concluded the Company maintained effective internal control over
financial reporting as of May 31, 2009.




Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements.  Therefore, even those systems
determined to be effective can provide only reasonable assurance with respect to
financial statement preparation and presentation.




This
quarterly report does not include an attestation report of the Company’s
registered public accounting firm regarding internal control over financial
reporting. Management’s report was not subject to attestation by our registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit the Company to provide only management’s
report in this Annual Report.




Changes in internal
controls




We have
not made any changes to our internal controls subsequent to the Evaluation Date.
We have not identified any deficiencies or material weaknesses or other factors
that could significantly affect these controls, and therefore, no corrective
action was taken.







4




PART
II - OTHER INFORMATION






Item
1.   Legal Proceedings.




Currently
we are not aware of any litigation pending or threatened by or against the
Company.





Item
2.   Unregistered Sales of Equity Securities and Use of
Proceeds




None.




Item
3.   Defaults Upon Senior Securities.




None




Item
4.   Submission of Matters to a Vote of Security Holders.




None.




Item
5.   Other Information.




None




Item
6.   Exhibits and Reports of Form 8-K.




(a)           Exhibits




31.1 Certification of Chief Executive Officer and Chief Financial Officer
pursuant to Section 302 of Sarbanes Oxley Act of
2002




32.1 Certification of Chief Executive Officer and Chief Financial Officer
pursuant to Section 906 of Sarbanes Oxley Act of
2002




(b)          Reports
of Form 8-K




None.




5










SIGNATURES




Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.




Signature
            
            Title
            Date/s/
      Jordan Starkman
            
            President,
      Chief Executive Officer
            July
      20, 2009Chairman
      of the Board of Directors
              Chief
      Financial Officer, Controller,
              Principal
      Accounting Officer













6