Types of debt · 4 min read
Payday loan debt: how to break the cycle
Payday and short-term loans are designed to be repaid quickly, but many borrowers end up taking new loans to repay old ones.
Rules that protect you
- Charges are capped at 0.8% per day of the amount borrowed
- Default fees are capped at £15
- You'll never repay more than double what you borrowed
- Lenders can only roll over a loan twice
What to do
Cancel any continuous payment authority with your bank if payments leave you short for essentials. Contact the lender about a plan, and include payday loans in a wider debt solution if you have other debts.
This article is general information only and may not reflect your circumstances. Rules and limits can change, so always check the details with an authorised provider before making a decision.
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