Payday loan payment arrangements3/29/2024 If there isn't enough money in your account to repay the loan on the agreed date, the lender may keep asking your bank for all or part of the money. This is called a continuous payment authority (CPA). When you get the loan you agree to let the lender take the money from your bank account. The most common way to pay back a payday loan is through your bank debit card. Usually you'll be given up to a month to pay back the money you borrowed, plus interest. For help, go to From 2 January 2015, there is an interest cap on payday loans of 0.8% per day and no borrower should have to pay back more than twice what they have borrowed. The lender should also explain how continuous payment authorities (CPAs) work and how they can be cancelled.Īll adverts for payday loans, including adverts sent by email or text message, must include the following warning ‘Late repayment can cause you serious money problems. The lender should also explain the main features of the loan, including how much you will have to pay back, what happens if you do not pay the loan back, that you may be charged extra if you do not pay the loan back on time and that the loan is not suitable for long-term borrowing. This means that, for example, the lender should check you’ve got enough money coming in each month to be able to pay the loan back. When you apply for a loan, before lending you any money, a lender should check whether you’ll be able to pay it back. Make sure you use the company's name rather than the website name when checking - it'll usually be on their homepage. You can check in the Financial Services Register if a price comparison website is regulated. The price comparison site must be regulated by the Financial Conduct Authority. Online payday lenders must publish their deals on at least 1 price comparison website so you can compare their deal with others. Make sure you shop around for the best deal. You can check your rights when you use a credit broker. There are rules they must follow, and you should also always check they’re approved by the FCA. You might be asked by a credit broker to pay a fee before they help find you a loan. You can check your lender is on the Financial Services Register on the FCA website. If they’re approved, they’ll be on the Financial Services Register. You should always check if your lender is approved by the FCA before you take out a loan. It might also be a scam if you’re asked to pay the fee quickly or in an unusual way - like with vouchers or with a money transfer. It could be a scam if you’re asked by a lender to pay a fee before you’re offered a loan. Check your lender is approved by the Financial Conduct Authority (FCA) This page tells you about what the lender should do before they offer you a payday loan, how you pay back the loan and what happens if you can't pay. Make sure you are clear about what will happen if you can't pay it back. If you decide to get a payday loan, shop around and compare the interest and charges before you borrow. There may be other ways for you to sort out your short-term money problem so think about the alternatives before you borrow from a payday lender. Payday loans can be easy to get but interest rates are very high. They are available from high street shops and internet sites. Payday loans are short-term loans for small amounts of money.
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