Struggling to make ends meet this month? Can’t pay that utility bill? Or do you need money for a short amount of time because your payday is too far off? New short-term loans or ‘Pay Day’ loans as they are commonly called, as they are typically only arranged for a month, are a relatively new concept but growing all the time.
A cash advance or payday loan is an unsecured temporary cash loan used to pay short-term expenses until the next payday comes along. They are ideal for people who just need a small amount of cash for a short amount of time. So who are the best value for money and who should you avoid?
Certainly with its fun and creative advertising, wonga.com is a name you won’t forget and for all the right reasons. A very easy to use site, I particularly liked the slider controls for deciding how much you want to borrow and for how long.
You need to fill in a basic questionnaire and must own a debit card but they do accept people who have had bad credit in the past. Promising to credit your bank within 15 minutes and to give you £10 if they do not, they also have a ‘refer a friend’ scheme where you can earn £20 for each friend accepted for a loan.
Rates for borrowing include an administrative fee of around a fiver and the interest rate is very reasonable. Once you have built up a ‘trust’ rating you can borrow more than the £400 for first time users. And they send you a lovely text when you have repaid the loan, a nice personal touch. ‘Like’ them on Facebook and get to enter competitions to win money. This is definitely my favourite and the best value for money.
Quick-payday.co.uk is another payday loan, providing same day loans for up to £1000. They offer a two-minute application and have a customer service team online or by phone. They also accept applications from less than perfect credit rated customers.
You can view your account online and repay in two instalments but unlike wonga.com you cannot repay your loan early. Also the charges are a little more than wonga, you are charged between £10 and £15 for every £50 borrowed. They will wire the money into your account within half an hour. Not a bad option if wonga won’t accept you.
UKQuickPay.co.uk take a little longer to get the money into your bank, on average about an hour, but this is because they are not actually the lender.
What they do is match you with a trusted and reputable lender who will best fit the needs of your personal situation and all applications submitted on their website are free of application charges. To apply you have to be at least 18 years of age, resident in the UK and be employed and paid by direct deposit.
With loans from £75 to £750, cashgenieloans.co.uk are one to be avoided. They actually charge you £20 to transfer money into your account on the same day, shocking when you consider wonga will recompense you if your money is not in your account by 15 minutes.
And afterall, most of us are applying because we need the money in a hurry. If you can afford to wait the transfer will take up to 3 to 4 days. Their charge for credit is 30 pence for every 100 pence borrowed. If you borrow £100, you would repay £130. Compare this to quick-payday who offer around £20 per £100.
If payday loans do not float your boat you could always ask your boss for a pay rise!