Compare the Best Payday Loans
Borrow up to £10001 for short term purposes
Payday loans are a really quick way of getting a small amount of cash for a very short time period. As you’ll know they have been heavily criticised, but these days the FCA and the payday lenders themselves have largely addressed the problems.
Other types of cash loan have also been developed that may suit you better, so it’s worth looking at these as an alternative to a payday loan.
If you are thinking of applying for a payday loan then please make sure that you are able to repay it on the due date. No lender wants you to end up with serious money problems. If you need cash for longer than a month then there are probably more appropriate options.
How to Get the Cheapest Payday Loan
Using our free loan search service means you’ll be:
- matched to the lenders who will lend to you in principle
- able to compare the best deals offered to you
- able to complete your application online and if accepted get your cash loan the same day (in fact many lenders can get the cash into your bank account much quicker than this)
The other benefits of using our search and comparison service is that you will only see the lenders who are able to lend so you’ll save lots of time not having to apply direct to lenders only to be rejected. And by seeing all the loan deals before you commit to a lender you can be more confident you’ve got the best payday loan deal.
Payday Loans Summary
- Borrow up to £10001
- We work with trusted lenders only
- Payouts within 24 hours are possible
- Our lenders have responsible lending policies
- Only use this type of loan in exceptional circumstances
- Only use for very short time periods
- There may be cheaper and more flexible alternatives open to you
A Comparison of Low Interest Payday Loans
First it is possible that a payday loan does not suit your situation – may be you:
- don’t have a bank account
- want to repay over a period longer than 1 month
- would prefer a face-to-face meeting
But if you still think a payday loan is the right type of loan for your situation then it is also worth noting that there are now restrictions on what payday lenders can charge, namely:
- a maximum daily interest rate of 0.8% (so no more than £24 per £100 borrowed over a 30 day period)
- no more than double the amount that was borrowed (e.g. if you borrow £100 you cannot be asked to repay more than £200)
- a limit of £15 for a charge if a borrower defaults on their debt
The imposition of these limits imposed by the FCA in January 2015 meant that many payday lenders left the industry. Those that remain are now more cautious, but they are also less able to compete on price. Most lenders are likely to charge similar amounts for their short term credit.
Having a bad credit history shouldn’t preclude you from borrowing. Loans are short term and a lender will be more concerned about your ability to repay the loan in a few weeks than what might have happened in your credit past. So while credit problems may not be the issue you expect you should be prepared to jump through some hoops in relation to proving you can repay any new payday loan – the so-called affordability checks.
If you have questions about payday loans make sure you check out our FAQ section. Here we cover all the main issues that you are likely to be wanting to find out about. Otherwise you can apply now for your loan.
Payday Loans: Dos and Don’ts
- Ensure you can repay on time
- Ask yourself if this is the correct type of borrowing for your needs
- Check if this type of borrowing is cost-effective
- Borrow if you can’t realistically repay it
- Roll-over repayments
- Worry about the APR% – look at total cost of repayment (compared to other cash advance alternatives)
Instant Payday Loans from Direct Lenders
Applying through Solution Loans is free – and our loan search service means you’ll be going direct to payday lenders and applying to multiple direct lenders simultaneously! A massive time saving. And using our service gets you the same deals as going direct.
We can’t think of any reason why you wouldn’t use our no fee loan service!
Technology means an instant response from lenders who can help you in principle. And in each case you’ll be able to stay online and complete your application with your chosen lender.
Search for Your Loan
How Payday Lenders became responsible lenders
(Also see our blog post “How the payday loan industry cleaned up its act“)
The Early Days
- The basic principle of a short term loan repayable on a person’s next pay day was created in the USA in the 1980s. Properly regulated short term lending was seen as a far better alternative to illegal loan sharking.
- This lending arrived in the UK on a tiny scale in the 1990s focusing initially on cheque cashing.
Growth & Expansion
- UK lending rose from £100m in 2004 to £2.8bn in 2012 (but compare this sum to the £55bn of outstanding credit card debt and £200bn of other consumer credit).
- The UK market for these loans grew particularly fast after the 2008 financial crisis. With banks in trouble and closing down access to credit for those with all but the best credit ratings lenders felt able to fill the void.
- It is estimated that 10.2m loans were taken out during 2012 with US-owned lenders dominating the market.
- In this period there was an explosion of loan advertising and in 2012 it was estimated that a TV viewer would have seen around 150 adverts!
- By 2012 the largest name in the UK market was Wonga – a business that only started in 2006. In 2012 its turnover was £185m and it generated £46m of profits.
Concerns & New Regulation
- As a reaction to the rapid growth in the market, with what was seen by many as the predatory behaviour of some lenders and the charging of excessive interest rates, a number of high profile individuals started to campaign for better regulation of the UK market.
- In April 2014 the newly formed Financial Conduct Authority (which replaced the OFT) confirmed its commitment to “clean up” the short term loans industry.
A Brave New World
- In January 2015 the FCA implemented a series of rules affecting all “high cost short term credit” lenders (including these loans):
- a cap on interest and fees equivalent to 0.8% per day
- fixed default fees capped at £15
- a total cost cap of 100% – meaning a borrower can never repay more than twice the amount they have borrowed.
- Since 2014/15 the UK payday loan market has contracted markedly with a number of well-known lenders leaving the industry. Other lenders have been forced by the FCA to make repayments to borrowers and write-off substantial amounts of outstanding debt.
- The Outcome of these changes – borrowers can be assured that lenders are now acting in the borrower’s interests. Charges and interest are capped and lenders have to behave properly when chasing outstanding debt. Where a payday lender does not believe a borrower can afford to repay the payday loan they will decline the application.
If you’re uncertain which type of credit might suit you or you have a money problem then one of guides may help you. We summarise each type of loan and their pros and cons, and address issues regarding debt and credit ratings.
Payday Loans - Your Questions Answered
Payday loans are small cash loans with the very specific purpose of getting you through a short term budgeting problem until your next pay day. On that day you should repay the loan in full. Payday loans should never be used to try to resolve a medium or even long term financial shortfall. The costs are simply much too high.
This is an example of how a payday loan could legitimately be used – your washing machine breaks down and will cost £150 to repair. Your normal monthly budget it tight.
You don’t have any savings so you need a small amount of cash to get you through. You use a payday loan of £150 and on your next pay day repay the lender the £150 plus (approx) £45 interest.
If you are in paid employment with a regular income but have few savings to draw upon in the event of a financial emergency then a payday loan could make sense.
But only if you can repay the loan in full on your next pay day from your pay only (i.e. don’t take out a new loan to repay this loan!).
Simply complete our enquiry form and we’ll find you a payday lender who can help you in principle. You will then need to complete a final stage of the online application process. Lenders typically 100% online processes you you will not need to handle any paperwork, and you should receive your loan the same day directly to your bank.
Please remember that lenders operate responsible lending policies.
The charging structure of payday lenders is pretty straightforward. They charge a fixed amount for each £100 you borrow and then you repay the full amount on your next pay day. The costs to truly avoid are the so-called roll-over fees.
So, make sure you are able to repay the full amount of the loan plus interest on the agreed date.
In terms of timing the only sensible thing to do is repay the loan amount and interest in full on the date you agreed with the lender. While your lender may agree to let you roll over the loan for another period you will accrue further charges and the debt will simply get larger. This is to be avoided. Do not take out a payday loan unless you can repay it and the interest in full when you agreed to!
Remember that the lender will take the money from your bank account as they have your debit card details. You need to ensure that you have a sufficient balance in your account on the day the lender will take the funds from you. If you do not extra costs will be triggered.
The first thing is that we would urge you not to borrow if the chances of you repaying on time and in full are remote. If you borrow knowing you cannot repay the loan the this is a type of fraud. If you are constantly struggling to balance your domestic budget then the last thing you need is more debt. In this situation you might do better getting some financial advice instead from an organisation like the Money Advice Service.
If you do borrow then keep in mind that payday loans are an expensive short term solution. Are there cheaper ways to get the emergency cash you need? Can you borrow from friends or family?
With a payday loan lenders will get access to your bank account using your debit card. These so-called “continuous payment authorities” mean banks can take money from your bank account without having to check with you first.
As is the case with any debt, whether it be a loan or a bill from a utility company, you must confront the issue if you doubt that you can pay on time. You must contact your lender and discuss the options open to you. Don’t delay.
If you have already missed one or more repayments then your debt will be increasing fast. A good idea is to also get in touch with organisations like:
The problem with payday loans is that while they are very “easy” to organise they are expensive and inflexible. The fact that you have to repay the full amount plus interest on your next payday means that something else in your budget has to be cut next month to compensate. This isn’t always possible hence the risk of the debt rolling on and the debt getting larger as further interest and charges accrue. This is the downward spiral you need to avoid.
Fortunately there are some alternative “short term cash loans” you could consider. Repayment terms are typically longer (if you wish) so that monthly repayments are lower. The APR% will be lower too, but keep in mind that the total amount you repay may actually be greater than with a payday loan because you are stretching out the repayment period.
You can also take advantage of our Find Loan tool to explore your loan options by answering just 4 quick questions.
In simple terms no. As with all credit if you repay it in full and on time then that good credit management behaviour will be recorded and it should actually enhance your credit file.
It is rumoured that some mortage lenders will treat the use of a payday loans as an indicator that your personal finances are not in order – i.e. you have resorted to the use of payday loans to cover cash flow issues. This could be treated by a potential mortgage lender as worrying sign.
We would always recommend that you treat the underlying cause rather than resort to a payday loan.
No. All payday lenders issue their loans direct to the applicant’s bank account using the “faster payment” system, or via BACS. If you don’t have a bank account then you could consider a doorstep loan instead.
Here are some things to consider:
- As you approach the repayment date for your loan if you don’t think you’ll be able to repay it you must contact your lender a.s.a.p. They are obliged to consider your situation and if necessary propose an alternative repayment plan.
- You must be clear about the terms of the loan as you may incur extra charges should you fail to repay the loan.
- Failure to repay your loan on time will be reported to the credit reference companies. This will be registered on your credit file and may hamper your ability to get credit in the future.
Never take the issue of credit lightly. You should only ever borrow if you believe you will be able to repay the loan, and you should be prepared for consequences if you fail to. It always makes sense to talk to your lender as soon as you suspect a problem.
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