Are there payday loan alternatives?

Stick man putting jigsaw pieces together

If you need a loan for over four weeks a payday loans can become very expensive.

A guarantor loan could be a more cost effective alternative.

We have 15 of the UK’s best lenders giving you the very best choice of guarantor loans.

Lower interest rates as you have a guarantor

By providing a guarantor with a clean credit history, the lender can afford to charge you less as there is less risk of you not paying back the loan.

Your guarantor will typically be a family member or friend, someone who knows and trusts you.

It does not matter if your credit rating is poor

The lenders look at the status of your guarantor rather than your credit file, so if you have missed payments say on a previous loan, a credit card, mobile phone or even a CCJ then this is not a problem.

Just like a payday loan you can pay off the loan at any time

One of the advantages of a payday loan is their flexibility, you can pay them off at any time. Most of our lenders have flexible payment terms which allow overpayments or paying off the full balance at any time.

Please note our lenders do change their terms and conditions from time to time, so make sure before you take out a loan with them that there are no overpayment, or early repayment, fees.

An affordable alternative to a payday loan

The differences between payday and guarantor loans

The following table briefly summarises the differences between a payday and a guarantor loan:



Bad credit history

Poor credit rating allowable, though precise criteria ranges from lender to lender.

Poor credit rating allowable, though your guarantor will require a clean (or only very slightly imperfect) credit history

Guarantor required




Designed to be taken for up to four weeks, up to your next payday. If you take the loan out for longer periods, the high interest rates can make this form of borrowing very expensive

Small loans are available from six months and larger loans up to five years, so there are many more options. But if you want a loan for only up to four weeks, payday could still be an option.


Loans typically range from £50 to £2,000 (though the upper limits are always changing)

Loans currently range from £500 to £15,000, so much larger loans are available

Representative APR?

Rates are typically up to about 1,500% representative APR (though this is constantly changing from lender to lender).

When borrowing between £500 to £15,000 the representative APRs range from 36.9% to 49.9%.

Early repayment and over payments

This is a commonly allowable feature with payday loans

This is a commonly allowable feature with guarantor loans

Discrete online application



Same day funds available

Yes – with many lenders

Yes – with our lenders smaller loans, on receipt of a completed application form


Payday loans have a poor reputation mainly due to very high interest rates. If you choose a reputable company and pay the loan back within four weeks, then this reputation should not worry you.

Guarantor loans are less well known, but this does not mean they are not an option to consider. They can be more cost effective, especially if you need the money for more than four weeks.

Frequently asked questions

1Can I find out more about guarantor loans?

Absolutely, we strongly believe that you should find out as much information as you can before doing anything.

Please check out our page What is a guarantor loan – The facts which gives plenty of detailed information.

2I would also like to find out more information about the guarantor

Finding a suitable guarantor is one of the most common questions, for more information on this please see our page Being a guarantor – all you need to know

Note that this loan application is simply a request from the lender for a no obligation quote based on the amount you want to borrow, how long for, plus the status of you and your guarantor.