Compare fast £50 loans

With interest capped at an eye-watering 0.8% per day, short term loans are far from ideal. At the same time, when unexpected expenses pop up, they have a role.

The funds on offer are smaller – and the rates higher – than loans on offer from traditional banks. You’ll also be expected to pay the money back faster.

How does a £50 short term loan work?

This form of loan is often referred to as a payday loan, because you’re expected to pay it back in one lump sum as soon as you can (most likely, your payday). The lender will ask you to name this day. Interest charges are levied daily, so the further in the future your payday is, the more you’ll be charged. This differs from traditional loans, where your debt is paid back in monthly instalments.

Key features of short term £50 loans

• High interest rates. The defining feature of payday loans is the high interest rates. The cap for payday loan rates was recently set at 0.8% per day, which amounts to an APR of 1,286%.
• Short repayment periods. It’s rare for short term lenders to offer £50 loans for more than 30 days, although some may stretch as long as 90 days.
• Late repayment fees. Short term lenders are known for clamping down on you harshly if repayments arrive late. It’s a good idea to compare late repayment fees, but it’s much better not to pay late at all.
• Quick access to funds. As these sorts of loans are for emergencies, many short term lenders boast about their transfer speed. It’s common to expect the money in your bank account within an hour. If you find a lender that takes more than a day to transfer £50, you might want to look elsewhere.

Pros and cons

Eligibility

Although it’s easier to be approved for a short term £50 loan than for a more traditional loan, most lenders still list minimum eligibility criteria. Read these criteria before applying to ensure you don’t waste your time asking for a loan you’re not eligible for.

For a loan of this size, most lenders check:

• You’re over 18 years old.
• You have a regular source of income paid directly in your bank.
• You have a valid phone number and email address.
• You’re not already in serious debt.

How to compare lenders

• Rates. This could be expressed as both a daily rate and the APR.
• Total payable. This is the total amount you’ll owe to the lender if you’re approved for the loan. The capital owed, plus the total interest charges. Many lenders include a handy toggle on their websites, which shows you the total payable based on the rate and term length.
• Available terms. Some lenders allow you to pick the exact number of days you’d like to borrow the money (usually up to 30 days). When you consider the size of interest rates, this is really useful. You don’t want to be paying interest for any longer than you need to.
• Early repayment options. When you consider how high the daily rates tend to be, it could be beneficial to find a lender that allows you to reduce your interest charges by paying the loan back early. Not all do, though.

Bottom line

Short term loans are intended as a short term solution. They shouldn’t be used as a solution for long-term financial difficulties. Before taking out any loan, you should compare your options and find the one most suitable to your financial situation. The easiest way to compare lenders is by using a comparison table. Our tables lay out all factors on the page in a digestible format that makes it easy to find the best deal for you.

With all these factors in mind, it should be simple enough to find the best possible payday lender for your needs. With such high rates in this market, the difference between the best lender and the rest could be quite significant, especially if you’re borrowing money for a number of weeks. However, it’s worth noting that an alternative method of borrowing might better suit your needs and be less costly to you.

If you do search for a lender using a different method, check whether it’s FCA registered. This ensures its terms and conditions meet certain compliance standards when offering payday loans.

Frequently asked questions

• Can I pay off my payday loan early?

  Many payday lenders allow you to pay off your loan early with no extra fees.

• How long does it take for the loan to be funded?

  Payday loan providers typically supply the funds to you fast. It can take as little as 15 minutes to receive the funds after your application is accepted.

• Is it a bad idea to repeatedly take out payday loans?

  Payday loans shouldn’t be considered a long term financial solution. They offer quick funding to help with unexpected circumstances that crop up. However, if you are seeking a longer term borrowing option or a more stable line of credit, you should look elsewhere. There are alternative longer term borrowing options with much better rates.

Written by

Chris Lilly

Head of publishing

Chris Lilly is Head of publishing at finder.com. He's a specialist in personal finance, from day-to-day banking to investing to borrowing, and is passionate about helping UK consumers make informed decisions about their money. In his spare time Chris likes forcing his kids to exercise more. See full bio

Chris's expertise

Chris has written 612 Finder guides across topics including:

• Loans & credit cards
• Building credit
• Financial health