Payday loans and prepaid cards

Wondering whether you can get a payday loan added to your prepaid card? It's possible, but there are good reasons to think twice.

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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 need to borrow cash quickly and tend to use a prepaid card for regular spending, you may be looking to get a payday loan transferred to your prepaid card.

First off, while this is technically possible, borrowing money to top up a prepaid card goes against the original purpose of prepaid cards. This was to allow those who couldn’t get a credit or debit card, or perhaps even a bank account (because of credit problems in the past), to make card payments rather than relying on cash – pretty crucial in an increasingly cashless world.

Adding borrowed money to a card designed to help people spend only the money they already have, so they always live within their means, could lead to further debt problems for anyone who has struggled with this in the past.

Some people use prepaid cards just because they help with budgeting, but because many of these cards have a monthly fee (typically £5 – £10), it’s those who aren’t eligible for a credit or debit card who have benefitted most from prepaid cards.

Payday loans are a way to get your hands on some cash fast to tide you over until your next payday. However, borrowers can sometimes struggle to repay these higher interest loans on time, and they rack up interest fast, leaving some owing up to twice as much as the original amount they borrowed.


  • Quick source of money. If you need money in a hurry, payday loans could be a good option. Some lenders can transfer you the money within minutes after acceptance.
  • You can still apply with bad credit. Most direct payday loan lenders focus on your ability to make repayments rather than just on your credit rating.


  • High interest rates. Payday lenders charge considerably higher interest rates than your typical personal loan. If you don’t repay your loan on time, it’ll be very costly as well as damaging to your credit record.
  • Not a long term solution. Payday loans don’t provide a long term financial solution due to their high interest rates.

Will a payday lender transfer a loan directly to my prepaid card account?

There’s nothing to stop you from asking a payday lender to pay a loan straight to your prepaid card account, and it doesn’t break any rules. However, you may struggle to find a lender willing to do this. When we contacted 2 of the biggest names in payday loans in the UK, both said they do not currently offer this facility.

If you depend on prepaid cards because you can’t get a bank account with a debit or credit card, it’s unlikely lenders will grant you a payday loan in the first place.

Some loan companies, known as doorstep lenders, offer cash directly to your door, usually at an extortionate interest rate. These lenders can be regulated (but many are unregulated) and are currently the subject of an investigation by the Financial Conduct Authority (FCA).

How can I transfer money from a payday loan to a prepaid card?

If you receive cash from a doorstep lender, and you want to add it to your prepaid card, then you would do so in the way you usually add cash to your prepaid card – by taking it to a PayPoint or the Post Office.

If you are required to give a lender account details, you can give your prepaid account details. However, the payday lender might not accept this.

The bottom line is that if you take out any kind of high interest loan, whatever you do with the cash, you need to ensure you pay it back as quickly as possible.

Should I be taking out a payday loan if I use a prepaid card?

If you have a poor credit history that prevents you from getting a credit or bank account with a debit card, chances are you might struggle to repay a payday loan, because of the typically high interest rates.

If you’re using a prepaid card, it’s safest not to take out a payday loan until your credit history improves and you’re in a position to use cheaper forms of credit.

Can I take out a doorstep loan and add this cash to a prepaid card?

Taking a loan from a doorstep lender puts you in a vulnerable position. Interest rates are high, and these lenders can be unscrupulous. Many are operating without submitting to regulation by the FCA, despite the fact this is breaking the law.

If you’ve already taken out a doorstep loan, it’s important to repay it as quickly as possible, whatever you do with the cash – whether you add it to a prepaid card or use it for spending.

Are there options besides prepaid cards?

Basic bank accounts do not charge fees, don’t let you go overdrawn and come with a debit card. Applications for these are credit-checked (which they aren’t for a prepaid card), but those with a poor credit record can still be accepted.

This could be a good option if you don’t want to pay the charges for prepaid cards.

A payday lender has refused to pay money to a prepaid card. What can I do?

If this happens, consider how to improve your credit record to get a regular bank account with a debit card. You can get on the electoral roll, seek debt management advice from a charity such as Step Change and try a credit-builder credit card to get you started. It may take a few months to improve your credit until you can open a bank account.


Simon, aged 35, lost his job and had no salary coming in for several months, during which time he took out credit cards but could not keep up with the repayments. He then got a job but sometimes struggled to pay his monthly debt repayments and meet living costs. He had a prepaid card for all his spending and needed to buy a new oven. A few weeks before his next paycheque was due, he was approved for a payday loan. Simon gave the lender the details of his prepaid card, and it transferred £200 to him. He bought the oven and repaid the lender the money plus a hefty £48 in interest when he was paid.

* This is a fictional, but realistic, example.

Bottom line

If you depend on a prepaid card and need a payday loan, it may be possible to have the money transferred directly to the card, depending on the individual lender’s policy. But do this only if you know you can pay the lender back – don’t be tempted to use that cash for general spending. If you need to borrow to meet basic outgoings, seek advice from the MoneyHelper.

Frequently asked questions

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To make sure you get accurate and helpful information, this guide has been edited by Joelle Grubb as part of our fact-checking process.
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Chris Lilly is Head of publishing at 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

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Chris has written 612 Finder guides across topics including:
  • Loans & credit cards
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2 Responses

    Default Gravatar
    LeanneDecember 8, 2018

    I’m just after a little advice please. Is it possible that I can get a loan with a prepaid MasterCard? I’ve never had a loan before just not sure on my bank that’s all. Many thanks!

      JoshuaDecember 12, 2018Finder

      Hi Leanne,

      Thanks for getting in touch with finder. I hope all is well with you. :)

      Yes, technically, this is possible. You can get your loan with a prepaid Mastercard. However, the options currently are limited. You might have a difficulty to find a lender who directly deposits the money to your prepaid card. Alternatively, if you really can’t find lenders who might meet your needs, perhaps, you can check how the lenders give you your borrowed cash and see if it will also work for you. You can start checking your options by using our comparison table above.

      I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.

      Have a wonderful day!


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