What counts as struggling?

If you are finding it difficult to keep up with your loan payments, for example:

  • You think you will miss your next payment

  • You have already missed a payment

  • You do not think you can pay your loan off over the term agreed

Important: If you are having financial difficulties speak to your lender straight away and explain your situation.

Speak to your lender

Your lender may put you on a repayment plan which changes your monthly payments to an amount you can afford, but this usually extends your loan meaning you pay back more.

If you cannot afford to pay the new amount offered in the repayment plan, or your payday lender cannot offer you one, contact the following debt charities for help:

If you do not speak to your lender

They will keep trying to take a payment from you, even if the last attempt failed.

If you miss a payment by direct debit because there is not enough money in your account, both your bank and the payday lender could charge you.

Your lender could also report your missed payment to credit agencies, damaging your credit record and making it more difficult for you to borrow in the future.

Delay your payment

Payday lenders could offer you the chance to delay, or rollover, your payment date to the next month.

Using a rollover gives you another month to make your payment, but means you pay an extra month of interest on your loan.

However, the Financial Conduct Authority (FCA) restrict how many times a lender can let you rollover:

Payday lenders and other firms offering high-cost short-term credit must now limit the extension of loans to two rollovers.

Source: Financial Conduct Authority (FCA)

Here is more information on how the FCA regulates payday lenders.

Stop your payment

Do this by calling your bank or building society, visiting them in branch or going onto your internet banking to cancel your payment.

To help speed up the cancellation process, tell your bank whether you pay your loan by:

  • Direct debit: This is set up using your debit card sort code and account number.

  • Continuous Payment Authority (CPA): This is set up using the 16 digit PAN* on your debit or credit card.

* Permanent Account Number - found on the front of your card.

If you think your payday lender has taken money without giving you notice, find out how you can fight back here.

Find a cheaper option

Payday loans are more expensive than most types of borrowing, but if you have a good credit record you could apply for a cheaper alternative to replace your loan:

  • Money transfer credit card: You can use the cash from a money transfer credit card to pay off your payday loan, some even offer 0% interest. Compare deals here.

  • Unsecured personal loan: You usually have to take it out for at least six months but it can be cheaper than a payday loan. Check the costs here.