Payday Loan Direct Lenders

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Representative Example: Representative 1286.98% APR on a loan of £300.00 with 5 monthly repayments of £101.03 Total amount repayable £505.13 Annual interest rate (fixed) 290%

This article contains information about products/services offered by us as well as those that we do not offer.

Author: Internal Marketing Department


Payday loans direct lenders is a common term which many of us are familiar with. The world of finance, as we know it, invites a mix of support and criticism. Let us discuss why it has served as a blessing for many customers and at the same time, is being criticized by various industry experts who have termed these loans are sure-shot ways of financial difficulty over a certain period of time. The unpredictable nature of these loans as well as the hidden costs involved has led to many people being trapped into a ‘cycle of debt” and something which has resulted in serious concern amongst the various authorities involved. The main reason for this has been the free hand many lenders have been working with for the past so many decades and this has led to almost half the economy falling into this massive debt trap.

Let us first discuss why this has been a blessing for many people:

·       They are extremely easy to apply and qualify. The main requirement is that you can afford the loan and the lender believes, from recent credit history, that you will repay it as required.

·       Your information is secure with the payday lending company you have applied to for a loan, as it is legally not allowed for any payday lending company to share any of your personal or banking information.

·       Filling out an application is extremely easy and the documentation involved is also a minimum. Many payday lenders offer a guarantee of only one hour for you to receive your money after the loan is approved.

·       Payday loans are usually short term, which means you should find it easier to determine whether the payment or series of payments are likely to be disrupted by external factors such as unemployment.

·       Your income restricts the amount you can borrow at any time, which makes it easier to pay back loans when you get your next payday. Companies are also supposed to ensure that your loan amount does not exceed your capacity to pay.

·       There are caps on the daily interest that payday lenders can charge and also on the total cost of the loan.

·       Payday Loans don’t restrict you from taking a loan for any purpose, which means you can pay for anything you wish.


Drawbacks of Payday Loans:

·       They can be expensive and the longer you have the loan the more they will cost.

·       They invite future dependency - some people get 'addicted' to them and continue to borrow even when there is no emergency need.

·       Due to the high cost of borrowing, if you have not assessed your finances correctly you can easily reach a situation where the loan is not affordable. 

Alternatives to payday loans direct lenders:

·       Credit Card Cash advances are being considered as a more viable option than any other payday loan. They usually work in the same way as payday loans direct lenders except for the fact that their interest rates are much lower in comparison.

·       Pawn shopping is still being considered as one of the best alternatives to payday loans. Pawn shops work on the simple concept of keeping something of minimum value in exchange of giving you cash which can be repaid over a certain period of time and as soon as the money is repaid, you will get the item that you have put as guarantee, back.

·       Borrowing from your family or friends may not seem such a bad idea. If you are uncertain about whether you will take the agreement seriously, it will always be better to put it in writing. Drafting a loan agreement detailing the exact amount of interest charge will compel you to take it more seriously.

·       Using someone other than your family friend or relative, to finance your loan. Sometimes, you may have a bad credit history and might not be eligible for a loan. You can always ask someone who trusts your capability to pay, to finance your loan and act as a guarantor. What is important to note in this case is that he will be responsible for your non-payment of the loan so it is extremely essential to know whether you will be able to re-pay the loan.

·       Credit Unions are another alternative to these payday loans direct lenders as these are usually run by people who are members of a society or who are working together or in the same neighbourhood. These are essentially not-for-profit institutions that work on low interest rates and are solely devoted to ensuring people are not falling into financial crises.


Overall View:

In conclusion, it is extremely important to understanding of the requirements of a loan and fully acknowledge your need to repay it. These loans are meant strictly for emergency purposes and should not be used as a daily alternative. The mistake that most of us are making today, is cashing in on their easy access to finance our everyday needs which is leading to a financial disaster. 

Representative Example: Representative 1286.98% APR on a loan of £300.00 with 5 monthly repayments of £101.03 Total amount repayable £505.13 Annual interest rate (fixed) 290%