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.
Response Funding loans 2020 review and similar companies
Previously known as Fancy a Payday, offers new customers short-term loans of £50 to £500 to be repaid in three fixed monthly instalments – in line with paydays. First-time customers can borrow up to £200.
Response Funding was formerly a direct lender, but is now a broker, authorised and regulated by the Financial Conduct Authority. Previously known as “Fancy a Payday”, it was overhauled in 2016 to better reflect its commitment to responsible lending and fast loan funding times – once approved, you can expect the money in your bank account on the same day.
Response Funding does not offer the same flexibility as many of its competitors, with loans for first-time customers set at £150-£200, and only one repayment option – three monthly instalments. On the plus side, it does consider applications from people with a poor credit history, additionally stating that if you pay back your loan in full on time this could help to rebuild your credit score – giving you more options in the future.
Key features of a Response Funding loan:
- Borrow £150 to £200. If you make all your repayments on time and pay off your loan in full, you could then be eligible to borrow up to £500. However, please remember that short-term loans are not suitable for longer-term or sustained borrowing.
- Repay over 3 months. Fast Funding only offers one repayment option of three equal instalments, in line with your payday, however you can actually repay the loan early at any point – saving money on interest.
- Fixed, high interest rates. With interest rates fixed at the maximum allowed by the Financial Conduct Authority, this is realistically an expensive way to borrow money.
- Bad credit considered. If you have a poor credit history, Response Funding will still consider you for a loan. The most important factor is your ability to meet the repayments. If you repay your loan on time, this could help to rebuild your credit score.
- No late payment charges. If you miss a repayment date, Response Funding won’t charge you a fee. They will report the late payment to a credit reference agency, however, which could harm your credit rating and your ability to secure finance in the future.
- Early repayment. You can repay your loan in full or in part at any time without being penalised. Simply call Response Funding to get a settlement figure. This is recommended, if you can manage it, because you’ll only pay for the days on which you borrow.
How do Response Funding’s loans hold up against the competition?
As well as comparing short-term loans with other types of credit, before you apply for a loan, it’s a good idea to shop around and compare a range of lenders. You can use the table below to get an idea of how much the loan that you have in mind might cost.
We compare payday/short-term loans from
How does a Response Funding loan work?
For new customers:
How do I pay back my loan?
Like most short-term loan providers, Response Funding uses a Continuous Payment Authority (CPA) to collect the repayments from your bank account on your chosen dates.
What is a Continuous Payment Authority (CPA)?A CPA is a recurring payment in which you give a company permission to withdraw money from your account on a regular basis.
CPA’s 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 CPA’s to collect your repayments. You can cancel this at any point by either consulting with your provider or your bank, but you’ll need to ensure that you make your loan repayments on time by other means.
What are the eligibility requirements?
You should only apply for a Response Funding loan if you are certain you can meet the repayment terms. You must also:
- Be at least 21 years old
- Be a UK resident
- Have a UK bank account
- Be in permanent employment
- Earn at least £900 a month and have it paid into your bank account
Is high-cost, short-term borrowing a good idea?
Short-term loans offer a quick solution when you get into unexpected difficulties with your finances, but they are a very expensive method of borrowing. Therefore, you should only consider this option 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 with serious debt problems.
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.
Did you know?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 should never have to pay more than double the amount borrowed.
Loans like Response Funding
Response Funding certainly isn’t the only provider of “high-cost, short-term credit” around. We’ve put together a list of lenders offering similar services.
Frequently asked questions
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