If you cannot repay your payday loan, we have some basic tips to limit the cost of your debt and to reduce the financial pressure.

1. What to do if you cannot
repay your payday loan
1
By Quiddi Compare

2. We appreciate that one’s circumstances can change which
means that it is hard to keep up with your payday loan
repayments.
It could be that you have taken out too many loans and are
struggling to keep up.
Perhaps you are waiting for your employer to pay your salary,
sales commission or you lost your job.
Whatever the event, these simple steps can help take the stress
off.
2

3. 1. Don’t Borrow More
Borrowing more from high-cost lenders will not help reduce
your debt – in may in fact make it worse.
Don’t be tempted to solve your short term financial troubles by
applying with other payday lenders. And make sure you
avoid any rollovers or extensions which will cause your loan
to significantly increase in cost.
3

4. 2. Speak to the lender
It is advisable to speak to the lender if you know in advance that
you will not be able to repay your loan on time.
No need to avoid emails and phone calls, by giving your lender
some notice, they may be able to extend the loan repayment
period at no extra cost. This is known as ‘forbearance.’
4

5. 3. Pay Plan / Arrangement
You can speak to your lender about setting up a ‘pay plan’ or
‘arrangement’ and this achieves to lower your outstanding
balance into smaller amounts over a longer period of time.
e.g instead of having to repay £100 at the end of the month, a
pay plan may allow you to repay £20 each month for the next
5 months.
Being in an arrangement will show up on your credit file to other
potential creditors.
5

6. 4. Debt Management
If you are heavily indebted to a number of lenders, you can
consider working with a debt management company.
This company or charity will put together all your outstanding
repayments and consolidate your debts. This means that you
will only have to pay into one account each month and the
debt management company will arrange to repay each lender
very small amounts over a very long period of time.
6

7. 5. Finally and most important
For any debt related issues or help, you can
receive further information if you visit
https://www.moneyadviceservice.org.uk/en
7