What is a Payday Loan

A payday loan is a short-term cash loan in an instant which you are required to pay back on your next pay day.

A payday loan (also called a pay cheque advance or payday advance) is a short-term loan, usually a small amount of money e.g. £500, that is intended to cover the borrower's expenses during the month until his or hers next payday.

Once the recipient has been paid their wages, they must pay back the loan with interest usually in the region of 1,355% APR.

Payday loans are intended for the masses that find themselves in financial trouble and generally have a bad credit rating. Due to financial insecurity they are unable to obtain cash advances or loans from their banks and so turn to alternative methods of obtaining cash advances.