Small Payday Loans in the UK – a SafetyNet Credit alternative
Looking for a small payday loan in the UK? Try our new small credit facility, a smart new alternative to payday loans.
for up to 40 days (292% per annum, variable)
In the UK a ‘small loan’ (or ‘little loan’ as they are sometimes called) is a fairly easy to grasp term which refers to a personal loan consisting of an amount of money at the lower end of what is available from most types of lending. Of course one could ask “just how small is a small loan, exactly?” There is no definitive answer to this. While many terms used throughout the credit industry have quite clearly defined technical meanings, there are many other common terms which are simply general, descriptive phrases with no strict legal definition – a ‘small loan’ would be one of these.
Generally speaking though, a loan would be considered to be a small loan if it was in the region of £50 to £500. Loans in the region of say £750 to £1,000 may often still be thought of as small loans, but they are at the larger end of the scale.
It is very unusual to find loans for amounts even smaller than £50, as this is the lowest minimum threshold amount offered by most lenders specialising in small loans.
Small payday loans
One of the most common types of small loan is a payday loan. This is because a payday loan is a form of credit designed to assist those with essential, unexpected costs over a short period of time, usually around one month or until the borrower’s next wages are received, hence their being called ‘payday’ loans.
Because of the very short repayment period the amount lent also tends to be quite small, between £50 and £1,000. This can be contrasted with lenders specialising in longer term personal loans, paid back over a number of monthly instalments, whose minimum lending thresholds frequently start at £1,000 or more.
Why might someone use a small loan?
There are countless situations where someone might find themselves in need of a small loan. Life is full of unexpected things which can’t be avoided, and we don’t always have the funds available right away to deal with them. When things are a bit tight it’s not uncommon to have slight shortfalls in your budget here and there. Examples of things which can come up include slightly bigger expenses, such as important repairs to your home or the vehicle you use for your commute. Then there are smaller but no less important things which can pop up, such as replacing a broken kitchen appliance like a fridge or microwave, or some smart clothes you may need for a job interview. There are also little things which can easily slip your mind, and so you forget to budget for them, such as materials for a child’s school project. The examples could go on.
It’s clear to see then the kind of situations which could arise where access to even a small amount of credit could make a big difference.
Small loans in the UK: things to consider
With any type of credit there are always a range of different things you should think about before making a decision. This is no different with small loans. Just because the amount of money you are borrowing may be relatively small, this does not mean you should rush into anything. A small loan should not be viewed any less seriously than a larger loan, as there can still be significant consequences for failing to keep up with repayments on a loan regardless of the amount borrowed. The affect a small loan could have on your credit rating is always one of the most important things to look into.
It is also always important to consider more affordable alternatives first, such as asking friends or family for some temporary financial assistance. Unfortunately however this will not be an option for everyone. If you have decided a loan is the right choice for your situation, it is obviously vital to get an idea of the specifics of the loan agreement, including how much you can borrow, how much exactly you will be repaying, and when you will be expected to make repayments.
Small loan alternatives with SafetyNet Credit
For those looking for a small loan, SafetyNet Credit offers an ideal service. Unlike a personal or payday loan we are a revolving credit facility. This means we offer a credit limit, based on what you can afford, of between £50 and £500 for new customers, and up to £1,000 for existing, trusted customers. This credit limit can then be used however you like. You have the option to make manual transfers to your account whenever one of those costs come up which you need a bit of help with. You can also set-up automatic transfers, which act as a safety net to stop you incurring charges and fees from your bank. When your current account balance reaches a certain level, decided by you, a portion of your credit limit can be automatically transferred to top you up and keep you out of any unplanned borrowing.
The great thing for those looking for small loans is that by having a credit limit with SafetyNet Credit, you’re completely flexible with what you borrow. You may not always need a loan of as much as £50 or £100 or £250 to cover your needs. With SafetyNet Credit, you can borrow only exactly what you require from your available credit limit, to cover your precise costs. You then only repay that amount borrowed, plus 0.8% daily interest, which is capped so it stops accruing after 40 days. This means that you can reduce the cost of borrowing by only using the small amounts you need.
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Initial reservations over read only access to my account were there but I can honestly say that this service is ideal for people needing a credit buffer who have bad credit history. It was fast and simple and gives you proper control in borrowing only what you need to cover your short term problem and offers great protection from unforeseen future issues.
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