A small short-term loan which is usually paid back on your next pay date. They are highly accessible and make it all too easy to fall into financial problems.
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A payday loan is a short-term loan that is usually paid back on the borrower’s next pay date. Payday loans offer people quick access to cash and often used by those people who are struggling to make their money last to the end of the month, as you can have your payday loan in your account within 15 minutes with some companies.
The amount you receive can range from as little as £50 to well over £1,000, however, you will always be required to pay the full sum of money back by your next payday, which makes it a difficult debt to manage.
One of the main reasons Payday Loans can be very expensive due to the high interest rates on these loans. Not only that but failing to repay the loan within the agreed upon time frame would also trigger penalties and fees which quickly overwhelm many borrowers.
Payday loan lenders also have direct access to your bank account, meaning they can make deductions from your account. This may be to cover fees you didn’t realise you owed, which were hidden in the fine print.
Payday loans can be an effective short term solution for unexpected expenses. They are useful for those who are in the right situation to benefit from them. More often, however, payday loans are being used as a long-term debt solution- which can have serious consequences.
If you are struggling to repay Payday loan debt contact our expert debt advisors to discuss your options. Our team can help you put a plan in place to let your get back on top.
Call now on 0800 121 48 63 or use the contact form on this page.
Latest figures from the Insolvency Service have indicated that personal insolvencies increased by 9.2% to 9,954 in September 2021 compared to August’s figure of 9,118.
Personal insolvencies in England & Wales increased by 0.2% to 9,106 in August 2021 compared to July’s figure of 9,090 and were 42.7 % higher than August 2020.
900,000 people are still expected to be on the scheme when it finishes on 30th September. As a result, huge uncertainty surrounds what might happen next.
