Auden is a “for-profit social enterprise” that uses advanced technology to undercut more established lenders in the high-cost, short-term loan market. It claims to be a new type of short-term lender, taking its social responsibilities seriously and permitting borrowers more flexibility than is normal with short-term loans.
But what does all that mean in reality? Well, it doesn’t charge some of the penalties that are normal for many traditional payday lenders, it caps both rates and the maximum amount you can end up paying for your loan at a slightly lower point than the legal requirement and it offers a degree of flexibility in its loans.
Warning: Late repayment can cause you serious money problems. For help, go to moneyhelper.org.uk.
Please note: High-cost short-term credit is unsuitable for sustained borrowing over long periods and would be expensive as a means of longer-term borrowing.
If you’ve used the calculator on Auden’s site to get a quote and want to see if you’re getting a good deal, find out how much a comparable loan is likely to cost you from some popular short-term lenders:
| Product Name | Auden Short Term Loan |
|---|---|
| Available Amounts | £200 to £1,000 |
| Loan terms | 3 months to 12 months |
| Soft search eligibility check | |
| Funding speed | Auden says that in most cases the loan will be transferred to your bank within 60 minutes of approval. The money is normally in your account soon after but at times this can take between 1-2 hours. |
| Repayment period options | Monthly |
| Default repayment method | Continuous payment authority |
| Repay early at any point | |
| FCA registration number | 674148 |
Like most short-term loan providers, Auden uses a Continuous Payment Authority (CPA) to collect your repayments. As part of the application process, Auden will take details of your debit card and carry out a zero-authorisation check. It does this to verify that the debit card belongs to you and was issued by your bank.
On each loan repayment date, Auden will use these details to collect payment from your current account using your debit card. Your repayment will be debited between 10am and 12pm on your chosen dates.
A CPA is a recurring payment in which you give a company permission to withdraw money from your account on a regular basis. CPAs differ from direct debits because they give the company being paid the ability to withdraw money from your account whenever they wish, and to take payments of different amounts without consulting you. Most “payday” loan companies will use CPAs to collect your repayments, however you can cancel this at any point by either contacting your provider or your bank.
You should only apply for an Auden loan if you are certain you can meet the repayment terms. You must also:
| Residency | UK resident |
|---|---|
| Minimum age | 18 |
| Additional eligibility notes | You must have a bank account (at the moment, Auden doesn't accept joint bank accounts). You must have a debit card with a major bank (unfortunately, Auden can't accept Monzo, Starling or Revolut at the moment) which passes a zero-authorisation check. You must have a mobile phone and email address. |
| Option to change repayment date | |
|---|---|
| Repay early at any point | |
| Repaying early can reduce overall interest | |
| Interest is only applied to days where funds are outstanding | |
| Multiple loans allowed at the same time | |
| Option to extend loan term | |
| Phone number | 0808 258 2525 |
In 2015 the Financial Conduct Authority (FCA) capped interest and fees on all high-cost short-term credit loans at 0.8% per day.
They additionally capped all default charges at £15 and the total cost (interest, fees) of loans at 100% of the original sum. This means you’ll never have to pay more than double the amount borrowed.
We liked that Auden doesn’t charge late fees (late payments will hurt your credit score, however, and you’ll end up paying more interest too). We also liked that you can repay early and only get charged for the days on which you borrow. The interest rates are steep – you’re still better off trying to avoid any high-cost, short-term borrowing if you can – however plenty of other lenders in the same space charge significantly higher rates.
Some may be put off by needing to give Auden read-only visibility of their current account using open banking, however this technology is now becoming much more widely by finance apps and lenders alike.
Short-term loans from lenders like Auden offer a quick solution when you get into difficulty with your finances, but they are a very expensive method of borrowing. Therefore, you should only consider this as a last resort. Short-term loans are unlikely to solve your money problems in the long term, and are not suitable for borrowing over longer periods, or for people who are in serious debt.
Before you apply for a short-term loan, make sure you have considered all other options carefully. Is the expenditure that you’re planning absolutely essential? If you can defer a purchase then you could save yourself money in the long run. If you are struggling to pay a bill, then try talking to your electricity, gas, phone or water provider to see if you can work out a payment plan. Read more about alternatives to payday loans at moneyadviceservice.org.uk.
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