Some people call this kind of borrowing, small pound loan, short term or a payday loan. It has been around for many, many decades – way before formal bank terms and rules applied to them. Regardless of whatever it is called, it is a type of instant loan that is traditionally repaid on borrower’s next payday. It is different from the modern cash advances since this is now associated with money borrowed from a person’s credit card. These are more for people who don’t have credit cards or less then stellar credit ratings.
Benefits of Direct Payday Lenders
Direct payday lenders, like our company, are those that remit cash to your bank account. Fill in your details on the lender’s website, communicate with the lender directly, and have the repayments collected directly from that lender. This transaction is not the same as a broker, who inserts themselves as a middleman between you and lender.
They are a small and short duration, as well as unsecured. It means that there is no collateral placed against what was borrowed. The amounts are small and can be repaid easily on the next pay cheque. If a borrower fails to pay on the designated day though, interest and penalties are applied. This makes the next repayment much bigger than the original amount that was borrowed.
Some people consider online borrowing as abusive and unfair since they charge a much higher interest rate than prevailing bank rates. However, there are several factors that work in its favor.
- Lenders do not need documents – most of the time, workers and employees can get paid without the need to produce documents and other requirements. They just need to be gainfully employed. Sometimes, the lender for 100 payday loans goes to different offices and workplaces and offer to lend there. Additionally, they often have contacts inside the HR department for their protection. They get updates if someone gets fired, quits, or no longer reports for work.
- No credit checks – one of the reasons they are so popular among employees and workers is because there’s no investigation or background check. Let’s face it, not everyone has a squeaky-clean record, which is one reason why they aren’t in the bank borrowing money.
- Bad credit is allowed – people who actually have bad ratings can still borrow. This is one of the main reasons why this type of lending is highly accepted. People who have previously defaulted on their mortgages can still borrow a small amount just to make it to the next pay cheque. Just because you’ve had a poor history doesn’t mean you can’t find help during emergency financial situations.
- No Collateral – companies do not ask for collateral. For one, the amount being lent isn’t that big. Second of all, they only make sure that the borrower has current payroll and employment records. It will also be returned in a short period of time, anyway.
What About APRs?
Governments all over the world regulate annual percentage rates (APR), even if they’re not considered part of the local banking system. There are laws that limit the APRs that can be charged by lenders to prevent unreasonable and very high interest rates. While people may consider a 17.50 pound interest from their 100 lending as reasonable, that’s still way above the allowed APR. In the US, for example, they have restricted lending to a 36 to 40 percent APR under the Uniform Small Loan Laws (USLL). This gives customers a very cheap loan, cheaper than in previous years.
Other countries, however, do not have laws that restrict APRs to double digits. According to guaranteed lenders, the reason why interest rates are higher is because of the great risk that they carry. As mentioned earlier, they ask for neither collateral nor background checks. This means that a borrower can simply not show up for work one day and disappear. Direct payday lenders will have no way to force him to pay if he is unemployed or missing.
The ideal scenario is to have money for emergency situations. However, if you’ve just started working or have been in between jobs for a long period of time, chances are you have zero savings and owe people money. New loans offer a reasonable amount of money which a person can borrow and return within 15 days to 1 month. You can apply online for this offer. This is enough to cover emergency financial situations such as bill payments, car repairs, someone getting sick, or going on an emergency trip without any pocket money.
People who resort to this say it is a lot better than going around and borrowing from people. More often than not, family members will give you a long lecture before they let you borrow cash. With PDLN, you can receive within 24 hours of your application. It can be credited to your account, or you can get it from the lender. It’s that quick and easy.
How Does One Apply with a Direct Payday Lender?
There are UK online loans sites which offer processing in as quick as 24 hours. The application process requires only a few minutes of the borrower’s time. The application forms are short and straightforward. Since there are no documents required, the application can be processed after only a short period of time. It is then transferred directly to his account, and withdrawn on the maturity date.
There are still traditional brick and mortar lending shops where a borrower can go to and fill up the forms in person. He receives a check or cash for the amount and he issues a check dated on when it is due. The advantage of the first process is the anonymity and convenience. If you need the money fast and don’t want to be bothered with going out or driving to the nearest direct payday lender office, the first one is the best option for you.
Who Benefits from this kind of borrowing?
A pay day loan is not just for someone who is in dire straits. In reality, you have single moms, ordinary employees, working students or couples who are just starting out their lives together also make use of them.
These are ordinary people who try to earn a living as best they could. Sometimes, though, things just happen and you find yourself low on cash. Getting a payday loan is a quick and easy solution to small financial problems. If you’re just $100 short on your credit card bill payment and want to be able to pay the whole amount, secure a quick loan and repay it on your next work check. Or, if your tires are in need of replacement and you don’t have a credit card to use, they are all you need.
The point behind securing paydays loans is to meet small emergencies and be able to repay the money back in as short as two weeks. It is not meant to be a regular solution to being short of cash, because the interest rate is also significant. Also, if you don’t pay on the maturity date, you will incur additional interest and more penalties. The rule of thumb is to borrow small and return the money promptly.
Payday Loans Online for Unexpected Expenses in The UK
We offer lending that helps people to handle emergency and unexpected expenses, in particular unexpected bills, vehicle repair bills, house maintenance and emergency medical bills. These moments are urgent and we will always try to help as fast as possible. This is why we provide, free of charge, a same day payout and we offer instant decisions with no extra fees. If approved, you will get your money today. We put together this article to help you find answers to many urgent questions.
How can I find the best online lending?
Like any other lending product, you should consider whether it is affordable. Examine the features and compare them to alternatives available; if you only seek a deal that meets your needs, should you get it. When obtaining one, you are essentially renting money. Pay it back with your next pay cheque from your employment.
How should urgent loans be used?
You should be use them as a quick remedy for urgent expenses or bills, but not as a long term financial solution. They are short term finance you obtain from an authorized direct lender. They are a wonderful solution so long as they happen to be cheaper than whatever alternative exists. Take the lending and as soon as possible, repay it. The best lenders will let you to repay early without extra cost or penalty.
Do we have “instant loans” available?
Instant refers to how quickly a decision is made to pay you. Yes, our loans are instant. We do a same day payout without extra fees, and after we have reviewed your submissions we pay within minutes. You could call this a quick loan. Our entire process is engineered to give you the quickest money possible whenever you have an urgent need.
How much can I borrow?
We are regulated by The Financial Conduct Authority (review our footer for all of our license numbers). Because we are direct, we are able to offer low APR, as well as the ability to repay early with no extra fees. The amount we are able to offer new customers varies. Only borrow enough to cover your urgent expenses – get enough from direct payday lenders so that you won’t have to take a second one because the first wasn’t enough.
What if I require more time to repay my loan?
We represent a new generation of lenders. Our main goal is to assist and defend customers who applying for lending online. Sometimes things do not go as planned, and we promise our best efforts to help. If you cannot pay back your loan in a timely fashion, let us know. We are very happy to work with you in making an affordable plan. Stay in touch, this is a team effort.
What should you look for when choosing a loan?
When examining the features of a good UK loan, first ensure you are working with a reputable lender. When selecting a company, only worth with those that list their contact details. In addition, verify whether they mention if they are a broker or a direct lender. Next, double check the company has a FCA authorisation number. A good company will provide it in a visible manner so you can verify their identity.
What are Bad Credit Loans?
They are loans given to people who have bad credit, where they often have no other option. Their credit rating is a major factor in determining your ability to get loans banks and financial institutions. These companies base their final decision on your credit score, which leaves millions of people in without access to credit. For these people, a bad credit loan is the only answer. The best course of action is to improve your credit score. This should be the end goal to anyone who has found themselves in need of obtaining a bad credit loan.
How do I get a payday loan in the UK with bad credit?
You can get a a loan online, even if you have bad credit. New loan lenders have worked out a business model that is offers affordable lending, but doesn’t rely strictly on your credit score. When applying for a loan with our company, we make an assumption that your credit is not perfect. We rely on other factors, such as employment, to make a decision on your ability to repay.
Can I get a short term loan without a credit check?
No. Under FCA regulations, authorised lenders must perform a credit check. However, we are able to offer lending even if your prior lending history is not good, because we factor in things such as your employment. If any online lender says they can lend without credit check, what they actually mean is that they will check it — but mostly ignore it in favour of other factors.
If you are still not certain, read online for reviews of the particular lender you are concerned with. You will quickly discover whether they are trustworthy or if there would be problems in dealing with their services.
What is a payday loan?
A payday loan is an unsecured lending of a small sum that is typically lent at a higher rate of APR interest, when both principal and interest is paid back at one future date. An average one is typically around £200 for 30 days. This industry underwent rapid growth between in recent years with a market well above £2 billion. Thousands of people resort to this type of lending to meet their monthly budget in times of crisis.
How is our offerings different?
We understand that by putting the customers needs at the very heart of our business model, we will do the right thing and help many people in the UK. Our primary mission statement is to help people in time of crisis by offering affordable lending, even when they have bad credit.
Do we Provide 3 Month Payday Loans to UK citizens?
While they traditionally last until the customer’s next payday – generally under a month, more and more companies are now offering 3 month payday loans. These are repaid with a smaller payment due each month instead of one lump sum at the end. The advantage of 3 month or longer is that the customer is more likely to afford the repayments. The disadvantage, however, is that there is more interest to pay, as the customer will have it for longer. Depending on the amount requested, they can be repaid with up to six monthly instalments.
How long does it takes to complete an application for an online loan?
Application only takes you a couple minutes. Apply for a loan only if you are certain it’s the right deal. While it can be completed quickly, you should take the time to provide all necessary information. Our team of finance professionals are available to help you with any issues. For most, the process is very quick and results in a transfer to your bank account within minutes of application.
What type of person applies for these types of loans?
We have had thousands of customers whom we are grateful have used our services. After years of being a leader in the industry, we have had the opportunity to get to know our clients first-hand. These are middle-class people who have steady jobs and yet occasionally come across difficult financial barriers in cases where they know they will receive funds at a future point, but unfortunately their next payment doesn’t come quick enough to meet their immediate needs.
Other cases reveal those who were temporarily laid off and found themselves without income for many weeks. These people need a little extra help while they establish themselves into a new career. In cases like this, the loan can be extended for longer periods of time, even up to 12 months. These people needed to fill a gap created by government benefits evaporating. When things like this occur, demand for them grows exponentially.
Pay Day Loans Are Cheaper Than Unauthorized Overdrafts
Another advantage offered by borrowing short term is that it is often cheaper than an unauthorised overdraft. Research shows that it could actually be far less expensive to take out a loan than it would be if your bank charges you for overdraft. This is especially the case if you find yourself having to remain in overdraft for any length of time. In such a case, you would borrow the money to make your bank account whole and then repay the loan upon your next pay cheque.
The Middle Class Mostly Benefits
Recently, over 150k applications for loan were analysed. The results were shocking; people in health care and social care utilise them to make ends meet and bridge the gap until their next pay day. Nurses, health care assistance, and other health care related professionals were the most likely to need to take out a short term loan.
The people involved in these industries were found to be forced into borrowing because their disposable income was reduced, and their ability to have access to regular credit lenders was withdrawn. People were given jobs that included less hours, which means they were given minimal income spread over a longer time frame. The government cracked down on unemployed who were utilising unemployment as a lifestyle. The people who were engaged in this type of behaviour quickly found themselves in need of funds to bridge the gap until they were able to secure more stable employment.
An Industry is Formed – The First Direct Payday Lenders
William Allan Jones is credited fro giving birth to the payday lending business model. In 1993, he opened a company in Cleveland Tennessee which offered people cash today for a post-dated check. He added an amount of interest and a service fee to the amount that was required upon repayment. This is a business model that had not been practised in over fifty years.
This essentially happened by allowing higher “usury”, or income tax, than had been previously allowed. Some accused Jones of bribing state legislators into allowing his business to thrive. They say that because of his lobbying efforts, laws were overturned allowing higher interest rates. This gave birth to the quick lending industry.
Six years after Mr. Jones reimplemented deferred payments, lenders in the US issued over 8 billion dollars worth of loans. Fast forward five more years, the industry was lending over $50 billion, a massive increase. Soon thereafter, the practise spread to other countries, including Australia and the UK. It has grown phenomenally ever since.
Payday Loans in the UK – Things you need to know
The UK started by having retail shops offer lending services. They argued their higher interest was justified because there is a higher risk involved, and more service included in issuing small loans. The market really exploded when the concept was taken online. Now, the industry is heavily regulated — where there is a cap on the interest able to be charged, as well as required processing such as credit checks, bank verification checks, fraud prevention and other safeguards and regulatory requirements. There are anti-money laundering and responsible lending checks that are required. Our company complies with all the rules required by the UK government.
Our company only operates online. We find this to allow us to serve you better, with 24/7 processing and making the process quick and easy. You can even apply with a mobile device, by applying online and having the money directly wired to your bank account. This is the most efficient method of operation and a great convenience to our customers.
How many people use payday loans?
The ACCA conducted a study in 2012 that analysed over twelve million short term loans that were issued in the UK. The amount lent was over £3.7bn worth of credit extended to UK borrowers and over £900m was paid in fees and interest. The growth of this industry has been tremendous. You certainly are not the only one in need of urgent funds — millions of people share the same boat as you.
What is the difference between direct lenders and brokers?
Direct lenders are companies who process your application while giving you money, without you utilising an intermediary. A broker, on the other hand, is an intermediary — or a middleman — someone who inserts themselves between you and the lender in the hopes of attaining a commission fee. The lender is the one who decides whether or not to lend. Brokerage companies often resort to selling your “lead” to multiple lenders.
There are things to be concerned of when using the services of a broker. Their goal is to get the most amount of money for themselves. If there are two places from which to sell your contact information, where one is the best deal for you (but pays a lower commission), while the other is more expensive (yet pays a higher commission), it is certain that a broker will do what makes themselves the most money.
It is, therefore, best to go direct and compare interest rates while selecting the very best lender. Our interest rates are nearly half that of Wonga, and lower than all our competition — but feel free to confirm this for yourself. With us, you can rest assured that your data is safe. We are here to help people facing real difficulties to secure the funds they need to meet those challenges.
What are new payday loan lenders?
There are new regulations by the FCA, and under those the lending industry has become a safer place for consumers. For example, lenders are only able to allow two interest-only rollovers per month. What is a rollover? It is where you only pay interest on the loan, with the principle “rolled over” to the next month. This is dangerous for borrowers who only pay the interest, making the cost of loan skyrocket. New payday lenders conduct themselves better for the interests of customers.
Complaints about lenders tripled in 2016 to the Financial Ombudsman, who released that data in their latest statistics. During this time, we have found our complaints to actually go down. We look to continue breaking the trend as more people realize there is a moral and responsible lender available to them in our company.
How do we compare to Wonga?
Wonga has become the poster child for payday loans in the UK market, long before the FCA stepped in. Wonga raised huge money in 2011 and channelled much of their profits into ads. They obtained promotions with three British football teams and massively promoted ads during daytime TV. While they provided quick lending, many people were unaware of the risks involved or that it was something to only use in the case of an emergency.
This is what spawned a massive consumer backlash and caused the FCA to take over the higher cost payday lending market. Wonga and other lenders were forced to refund millions of pounds to clients for their irresponsible promotions and business model. While they are still a huge part of the market, there are newer options and nearly every one of them is cheaper than Wonga. Their APR interest rate remains the highest, at well over 1500%, while ours is nearly half that.
Conversely, our goal and mission is quite different from that of Wonga. We do not aim to be like them. The FCA has mandated that treating customers fairly is a primary objective. We believe it is possible to be a company with integrity and higher moral standards. We will not lend if we believe it will cause undue financial stress to you.
Who Are The Best Direct Lenders in the UK?
The FCA has new restrictions confining how all businesses operate in this sector. As such, you would think they are necessarily the same. However, that’s not the case, there are differences between the various lenders. Here is a guide that will allow you to tell the difference.
Good lenders stick to the rules. They not only understand compliance with strict FCA guidelines, they realize they are there to protect people using the lending service. The best lenders have TCF (Treating Customers Fairly) policies, going above and beyond the guidelines required by the FCA. Great lenders are professional and transparent.
Our goal is to do better for our clients than any of the competition. We measure our success by how many people we are able to help overcome the difficulties they face in a way that is affordable for them, and responsible. We take pride in helping you succeed against adversity.
Are all payday lenders as bad as loan sharks?
Our ultimate goal is to protect our UK customers while they apply for a loan online. Our business model is fundamentally based on a moral posture, striving to offer the best credit product possible. If you are in a tight financial situation and you have nowhere else to turn, your best option is to use our lending products. We allow you to repay as early as you desire, while saving on interest and without additional fees. Customers worldwide have sought for this type of offering, and we are thrilled to provide it.
How to compare loan offers online?
The fact is there are many companies all promoting different rates or features within their loans, so how can you compare these to get the right one for your complex situation? Many smaller decisions are wound within this task, with choices between interest rates, extra charges, penalties if you are unable to repay promptly, and other diverse issues. While you are free to compare lenders using a website that reviews each one, we encourage you to check them out for yourself. Keep an eye out for the APR interest they charge. Our homepage has a great comparison list.
Final thoughts on keeping yourself safe while shopping for a loan
If you are ever contacted by someone from Payday Loans Now claiming to be offering a loan, it is a scam. We do not outreach like this. We conduct ourselves entirely online, through this website. We will never cold-call you, soliciting for you lend. Thank you for visiting, and we hope to help you in the near future!