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.
StepStone Credit short term loans review February 2020
StepStone Credit offers a line of credit of up to £500 for a fixed period. Unlike traditional short-term lenders which require set monthly payments, you can withdraw and repay as much of your loan as you like, as often as you like, during your agreed term.
StepStone Credit is a direct lender (not a broker) with a slightly different take on short term lending. Its credit facility offers instant and flexible access to money on the go, through its App or website. Subject to a credit limit, you’ll be able to decide how much to borrow and when to borrow it, without having to apply each time you need to borrow. Interest is charged only on the funds you’re borrow, on the days you borrow, so you could save money if you can afford to pay your loan back quickly.
How does StepStone credit hold up against the competition?Use the table below to estimate the cost of the loan that you have in mind. We compare loans from a range of popular short-term lenders. Remember that each lender sets its own min/max loan amounts and terms, and its own eligibility requirements.
We compare payday/short-term loans from
What is a line of credit?
A line of credit is an ongoing credit facility, with agreed limits. Examples include an overdraft or a credit card. Unlike a loan that’s issued as a lump sum and paid off over a fixed period, a line of credit can be accessed whenever you need it, and you can borrow as much or as little as you like, subject to an agreed maximum. You can also pay the money back when it suits you, subject to agreed minimum repayment conditions.
The advantage of a line of credit is that it’s there when you need it, and you only borrow what need for the time that you need it. This can work out cheaper than borrowing a lump sum over a set period. However, the disadvantage of a line of credit is that the ease and flexibility can lead you to borrow over longer terms than you might have otherwise, or even simply to borrow when you might not have otherwise.
Key features of a StepStone Credit facility
The StepStone Credit facility lasts for 3 months – after this point you’ll need to agree the facility with StepStone Credit again.
|Product Name||StepStone Credit Account|
|Available Amounts||£200 to £500|
|New customer maximum||£500|
|Loan terms||to 3 months|
|Soft search eligibility check|
|Instant decision in most cases|
|Funding speed||Once you are approved for a loan, you can expect to have the line of credit available to you within 30 minutes.|
|Repayment period options||Monthly|
|Default repayment method||Continuous payment authority|
|Additional repayment methods||Online payment|
|Repay early at any point|
|Parent company||Hymarc Ltd|
|FCA registration number||683980|
How does a StepStone Credit loan work?
- Apply for a line of credit with StepStone Credit by filling out the simple application form on the website. You will be asked to provide personal details as well as financial and employment information.
- StepStone Credit will ask for your internet banking details, so it can check your statements and ensure you can comfortably afford to make the repayments.
- Once you are approved for a loan and your account is opened, you can withdraw and repay funds up to your agreed limit as often as you like within your set term.
- At the end of the term, StepStone will make a final automatic repayment from your debit card for all of the outstanding balance owed. Once this balance has been successfully paid, your credit facility will be closed.
What are the eligibility requirements?
You should only apply for a loan through StepStone Credit if you are certain you can meet the repayment terms. You must also:
|Additional eligibility notes||You must have a UK bank account with online banking facilities.|
As part of the application process, StepStone Credit will conduct a financial review including a real-time review of your bank account statement (by accessing your internet banking) which will help to determine if you can afford the repayments.
How do I pay back my loan?
Like most short-term loan providers, StepStone Credit will use a Continuous Payment Authority (CPA) to collect the final repayment from your bank account on your agreed date.
What is a Continuous Payment Authority (CPA)?
With a CPA you give a company permission to withdraw money from your account whenever it wishes, and to take payments of different amounts without consulting you. Many short-term lenders like StepStone Credit will use a CPA to collect your repayments. You can cancel this at any point by either consulting with your loan provider or your bank. If you do opt to cancel it, however, you should make sure that you still keep up with your repayment schedule by other means.
Early repayment options
|Repay early at any point|
|Repaying early can reduce overall interest|
|Interest is only applied to days where funds are outstanding|
Is high-cost, short term borrowing a good idea?
Short term loans offer a quick solution when you get into difficulty with your finances, but they are a very expensive method of borrowing. They should therefore only be considered as a last resort. Short term loans are unlikely to solve your money problems in the long term, and aren’t a good idea for borrowing over longer periods, or for sustained borrowing.
Before you apply for a short-term loan, make sure you have considered 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’re 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’ll never have to pay more than double the amount borrowed.
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