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Payday Loans Alternatives

£200 £2000 Representative Example: Amount of credit: £1200, interest rate: 49.9% pa (variable) and 1.65% transaction fee. Representative 68.7% APR (variable)

Looking for a payday loan? Try our cheaper credit line instead

Polar Credit is a direct lender offering a revolving credit facility that you can use daily to help with your daily expenditure. An account with us lets you withdraw funds when needed, with cash transferred to your bank account within minutes of approval.

We know what matters to customers when they are looking for credit – a simple online application form, a quick decision and fast access to cash. Our credit line brings all of this together but in a product that also comes with a much lower interest rate when compared to a payday loan.

Application form

We ask you to provide us with some information about you that helps us make our lending decision, such as your full name, address and date of birth, together with the details of your employment, income and expenditure.

The entire application process is done online, and because we are a direct lender, we tell you the outcome of your application in only a matter of minutes.

Our lending decision

We use the information that you’ve provided in your application form together with the information in our own database and the information that we receive back from the credit reference agency to make a quick decision on your application.

It is important that you accurately fill in the application form to make sure that we have access to all the right information to help us assess your application. If the information that you provide does not match our records, we may have to ask for further information to continue with your application.

We are a direct lender not a broker, and we make all our lending decisions ourselves. Please take your time when applying to consider all the questions in our application form, as that helps us make our decision.

Once the application form is submitted, there is no more waiting time to find out the outcome of your online application. We will tell you straightaway if you’ve been approved and the amount of credit that your credit line has been approved for.

The entire process takes place online, and your Polar Credit account is available for you to use immediately after you eSign your credit agreement.

Bad credit or no credit history? We will try to understand your circumstances as they are today and focus on the future.

Got a thin credit file or a bad credit history from some poor decisions made in the past? Don’t think that a payday loan is your only option when you are looking for credit.

While we may not be able to approve some customers who still continue to miss their repayments, those with defaults in the past can still qualify for our cheaper alternative to payday loans.

Fast transfers

If you need an instant payday loan, it is often because you need immediate access to cash at that point in time, and our credit line can match the service that you would expect from some of the best online payday lenders in the UK.

Once your Polar Credit application is approved, funds are transferred to your bank account within minutes of you making a withdrawal request. You can access the money shortly afterwards as long as you hold your account with one of the main UK banks that supports Faster Payments.

The cost

Sounds like all of the best features of payday loans so far? Well, here is what we think is the best part of our alternative solution – the cost. Taking out a £100 payday loan for 30 days can cost you as much as £24, while it only costs £5.75 to borrow £100 for that length of time from us.

While it is not easy to find a cheap payday loan, and many people would argue that cheap payday loans simply do not exist, our service is more than 75% cheaper than a £100 payday loan from a direct lender when you need to borrow for 30 days.

What are payday loans?

A payday loan is a small loan, lent at a high-interest rate, under an agreement that it will be repaid after a short period of time, usually when the customer is next paid.

As well as offering loans for a short period of time, payday loan providers typically offer loans that are small in value, often between £100 and £1000, though the amount you can borrow will depend on your circumstances and creditworthiness.

For example, if you have a poor credit rating, you will likely be offered less money for a loan. The maximum a payday loan can cost in the UK is £24 a month per £100 borrowed (based on a 30-day month).

Payday loan repayments can sometimes be split over 2 or 3 months if that better fits the borrower's circumstances. Some may even go on for as long as a year, but at its core, a payday loan is a short duration product that needs to be repaid in a relatively short space of time.

These payments are usually taken out using the debit card details that you provided at the time of the application. You must therefore have enough funds in your bank account to cover these payments on your repayment dates, or you may receive a missed payment mark on your credit history, lowering your score.

Best payday loan alternatives

Before you take out a payday loan, there are several payday loan alternatives to consider instead.

A bad credit loan

Struggling with your credit score? Don't worry; there are still options available.

Bad credit loans are designed specifically for people with a tricky credit history. These loans have higher interest rates and you may be restricted in the amount you can borrow, but they are an option when you are strapped for cash.

Cash advances

Do you have a credit card? If you haven't reached your credit limit yet, you may be able to withdraw funds from a cashpoint or as a transfer to your bank account. Although unfortunately, there will be a cash advance fee and interest on taking out the cash.

Guarantor loan

If you are struggling to get a loan with a poor credit history, you could ask a friend or family member to act as a guarantor for your loan. A guarantor can increase your chance of approval and help you get back on your feet.

An overdraft

Check to see if you have access to an authorised overdraft with your current account. This is an overdraft that has been approved by your bank for an agreed interest rate. Once you enter your overdraft, you will normally see a "-" symbol before your bank balance, indicating how much money you owe.

Personal loan

If you have a better credit score, you could apply for a personal loan and pay back the money over six months or more.

Budgeting loan

An interest-free budgeting loan is available for those on benefits in the UK. It can help you pay for household items, maternity costs, clothes and much more.

Credit lines

A credit line allows you to borrow money, repay it and borrow again as long as you stay within the terms of your credit agreement. You will still be charged interest on the borrowed balance, but a credit line comes with more flexibility than a payday loan and a much lower interest rate.

What happens after I’ve been approved?

Once your Polar Credit application is approved, it is even quicker to access extra cash when you need it again. Our credit line is designed to be used as and when you need extra funds for your everyday expenditure.

As an existing customer, you can withdraw extra cash at any time as long as you make your scheduled payments in a timely manner and stay within the terms of your credit agreement.

Reliable and consistent

We trust you to make your repayments on time, and it is important to us that you can trust us to be there for you when you need quick access to extra cash. Customers who use payday lenders are often unhappy about the unpredictability of lending decisions. They can be approved once and repay on time, but then can’t borrow again even though nothing has changed. Don’t get left out in the cold!

At Polar Credit, we give you an alternative to payday loans that you can rely on. As long as you budget responsibly and make your agreed repayments in a timely manner, we are always here for you so you can borrow up to your credit limit whenever you need to. There is no need to make multiple applications when you need to borrow money again, and you do not risk having your application rejected because we offer you a credit limit that you can rely on.

Credit where it’s due

Payday loans are an important part of consumer credit, and they help lots of people every day manage the ups and downs of their income and expenditure.

Online payday loans, in particular, have shown that quick access to credit through a simple and easy-to-understand online application form is fast becoming the norm.

Payday lenders brought a lot of innovation to the consumer credit market, but now we are delighted to offer you a payday loan alternative that gives you access to credit in the same innovative way but at a much lower cost.

Polar Credit is the next generation of online consumer credit products. Our aim is to offer you the same speed and convenience that you may get from getting an instant payday loan online but at a much lower interest rate and a Representative 68.7% APR (variable).

Apply now for a Polar Credit Line and leave payday loans behind!

FAQs

How do payday loans work in the UK?

The application process for payday loan companies is relatively straightforward.

You fill out a simple application form with your personal details and bank details. The lender does a creditworthiness assessment of your application and, on average, you will receive a decision within 24 hours. If approved, the money will be paid into your account very quickly, often within minutes of the decision.

Payday lenders will consider a wide variety of circumstances, however, your credit score and affordability do also play a role in whether you can receive a payday loan.

Payday loan lenders need to make sure you can afford the repayments before approving your application. If you have a poor credit score and a history of missed payments, you may still struggle to get this type of loan.

Are payday loans safe?

In the United Kingdom, payday loan lenders are regulated by the Financial Conduct Authority (FCA) and must comply with the rules that govern them.

Some of the most well-known regulations in this market include a cap on interest, a cap on default fees and a cap on repayment collection attempts using a continuous payment authority.

If you are applying with a lender you haven’t used or heard of before, check the FCA register to make sure that you are dealing with a regulated lender who will follow the rules. This applies whether you are looking at applying for a payday loan or checking out some alternatives to payday loans instead.

Do payday loans affect your credit score?

Payday loans are often linked to unreliable borrowers. So, if you have a payday loan on your credit report, future lenders may use it against you.

If you meet all your repayments and work on reducing your debt, future lenders could also see it as a sign you're a reliable borrower. It all depends on how you manage the loan, how many payday loans you have and what period of time do you use them for.

Please bear in mind that all lenders have different ways of calculating your creditworthiness. Each lender uses their own criteria and method, so your credit risk and chances of getting accepted will vary.

Why should I avoid payday loans?

When you're struggling for cash, a quick payday loan can seem like the only way out. However, they come with their own drawbacks that you should consider first – including:

Missed payment can harm your credit score and make it more difficult or more expensive to get approved for credit in the future.

Ready to Apply?Polar Credit

Representative Example: Amount of credit: £1200, interest rate: 49.9% pa (variable) and 1.65% transaction fee. Representative 68.7% APR (variable)

£200 £2000