Payday Loans

Cara Bradley

Written by

Cara Bradley

5 min read

Updated: 29/01/2024

Whether it’s a broken kitchen appliance or a car that refuses to start, financial emergencies can crop up at any time and threaten to leave us out of pocket. If things go wrong between paydays, and our savings don’t quite cover the costs, you may have thought about taking out a payday loan.

What are payday loans?

Payday loans are designed to tide you over between one payday and the next, should something urgent come up that cannot wait or be covered by savings.
As the name suggests, the money borrowed is usually repaid in full on or around your next payday.

Do Viva Money offer payday loans?

Viva Money is a credit broker, not a lender.
We work with a panel of trusted lenders who offer short-term loans between £100 and £10,000, with repayment terms from 3 to 60 months. We do not search for payday loans, but if you’re looking for a loan you can repay in instalments, we might be able to help you.

Who can apply for a payday loan?

Each lender will have their own application criteria but, generally, you can apply for a payday loan if you:

  • Are over 18 years of age;
  • Have a UK address;
  • Have a UK-issued bank account and valid debit card; and
  • Have a regular income paid into your bank account.

Can I apply for a payday loan with bad credit?

You might be able to apply for a payday loan even if you have bad credit; however, it’s worth bearing in mind that, if accepted, you may be offered a higher interest rate.

Some of the lenders on the Viva Money panel specialise in loans for people with bad credit - this might be something to think about if you decide that a payday loan isn’t quite right for you.

Can I apply for a loan with no credit history?

If you have never borrowed credit or paid bills before, it’s likely that you will have no credit history. This is known as having a ‘thin’ credit file and may make things more challenging should you apply for a loan. This is because lenders have no record of how you manage credit, so may see you as a risk.

Viva Money work with a number of lenders who may be able to help with loans for those with no credit history.

How long does it take to apply for a payday loan?

Many payday loan providers offer online applications that can be easily completed in around 5-10 minutes.
This process is not exclusive to payday loans, however; you can also complete straightforward online applications with many lenders.
If you search for a loan with Viva Money, we’ll be able to show you the results of your search in around 60 seconds.

If approved, how long will it take to receive the money from my payday loan?

Payday loans are usually used in an emergency to fund an urgent payment, such as a broken-down car or packed-up boiler. If time is of the essence and that vet’s bill just can’t wait, you might want to check with your lender when you can expect to receive your loan.

If you’re looking to borrow money, payday loans may not be your only option. A number of lenders on our panel are able to transfer your money on the same day your application is approved.

Whether you have applied for a payday or another type of loan, please bear in mind that the time it takes for the money to appear in your account will depend on your bank’s policies and procedures.

How much money can I borrow, and for how long?

The amount you could apply to borrow with a payday loan will vary between lenders and will depend on a range of factors, including your credit history and your income and outgoings.
Payday loans typically tend to be for smaller amounts of money; this is intended to make repaying the full amount on your next payday more manageable.

A payday loan may not be the right option for you if you’re hoping to spread the cost of the loan over a longer term. Being able to repay your loan in instalments could make borrowing more manageable.

Viva Money work with a panel of lenders who offer loans with terms between 3 and 60 months depending on the amount you borrow.

Will taking out a payday loan affect my credit score?

Payday loans – and other types of loan – could have a negative effect on your credit score if they are not repaid on time. Falling behind on or missing repayments altogether could result in late fees, additional charges, and a decline in your credit score.

When you apply for a loan directly with a lender, they are required to run a hard search on your credit file. Hard searches may remain on your credit file for up to 12 months, and too many hard searches over a short space of time could lower your credit score.

You can help protect your credit score by using a credit broker – like Viva Money – to run a soft search on your financial history before making a full application with a lender. Soft searches are only visible on your credit file to you, and the company who carried out the check. They’re designed to give you an idea as to whether you might be approved for a loan before you make a full application.

I’m struggling to repay my loan – what can I do?

Being in a position where you feel unable to make your loan repayments can be frightening, but please try not to panic. There are things that can be done to help relieve the pressure.
Firstly, you should contact your lender. They will appreciate you being honest about your situation and will talk you through your options moving forwards.

Talking openly about money can be difficult, but please know that there are always places you can turn to for help.
You can access free, impartial money management and debt advice on sites such as MoneyHelper, Citizens Advice, and National Debtline.

Viva Money is proud to have teamed up with StepChange to provide a free money health quiz. The answers you provide are confidential and will generate advice designed to help you with your next steps.