Loans Without Bank Account

Looking for loans without a bank account? Learn about the types of loans available, their costs, pros and cons, and alternatives.

Table of contents

Written by Mark Grimley
Read time: ~5 mins
Published: 28th September 2023

Can I get a loan with no bank account?

You might be wondering if it's possible to get a loan without having a bank account. The answer is both yes and no. Most lenders typically require a bank account, but there are alternative options available that cater specifically to individuals without one. These alternative lenders understand that not everyone has access to traditional banking services and have designed loan products to meet your needs.

Why do lenders need you to have a bank account?

Lenders usually prefer borrowers with bank accounts for a few reasons:

  • Repayment: Having a bank account makes it easier for lenders to set up automatic repayments, ensuring that you don't miss any payments.
  • Verification: A bank account allows lenders to verify your financial information, such as your income and spending habits, helping them assess your creditworthiness.
  • Security: By depositing loan funds directly into your bank account, lenders can ensure a secure transaction and reduce the risk of fraud or theft.

What types of loans can I get without a bank account?

Fortunately, there are several types of loans available for individuals without a bank account. Here are some common options:

  • Pawn Shop Loans: Pawnbrokers allow you to borrow money by using valuable items, like jewellery or electronics, as collateral. No bank account is typically needed for this type of loan.
  • Home Credit Lenders: Certain lenders can provide cash loans to your door. These are sometime called Doorstep lenders. Before going down this route ensure they are fully regulated and authorised by the FCA.

Remember, each loan type has its own terms and conditions, so it's crucial to carefully compare your options before making a decision.

How much do no bank account loans cost?

The costs associated with loans without a bank account vary depending on the lender and the specific loan product. It's important to understand that these loans often come with higher interest rates and fees compared to traditional loans. Here are a few factors that can affect the cost of no bank account loans:

  • Interest Rates: Lenders may charge higher interest rates to offset the risk of lending to individual without bank accounts.
  • Fees: Additional fees, such as origination fees or late payment fees, may be included in the loan terms. Make sure to review the loan agreement carefully to understand all associated costs.
  • Loan Amount: The amount you borrow can impact the overall cost. Larger loan amounts may result in higher fees or interest charges.

When comparing loan options, pay attention to the Annual Percentage Rate (APR), which includes both the interest rate and any applicable fees. A higher APR means a more expensive loan.

What are the pros and cons of no bank account loans?

No bank account loans can provide a lifeline for those in need of quick cash, but it's essential to consider both the advantages and disadvantages before making a decision.

  • Accessibility: These loans are designed for individuals without a bank account, allowing you to access funds even if you're unbanked or underbanked.
  • Quick Approval: Alternative lenders often offer faster approval processes, meaning you can get the money you need more quickly compared to traditional lenders.
  • Flexible Repayment Options: Some lenders offer flexible repayment options, making it easier to manage your loan obligations based on your financial situation.
  • Higher Costs: Loans without a bank account typically come with higher interest rates and fees compared to traditional loans.
  • Limited Options: The range of loan products available may be narrower, and the loan amounts may be lower compared to what traditional lenders offer.
  • Potential for Predatory Lending: Be cautious when dealing with lenders who exploit individuals with limited financial knowledge. Always choose reputable lenders by using a trusted comapirson site, such as Choose Wisely.
  • Loss of Personal Items: If you've pawned some of your possessions with value, and can't repay the loan, you may end up losing those things altogether.

It's crucial to weigh these pros and cons against your specific circumstances and financial needs before deciding on a loan without a bank account.

What are the alternatives to loans without a bank account?

If you're unable or reluctant to pursue a loan without a bank account, several alternatives can help you access funds or meet your financial needs. Consider the following options:

  • Credit Unions: Credit unions are not-for-profit financial cooperatives that offer loans and other financial services to their members. They often have more flexible requirements and competitive interest rates.
  • Friends and Family: Reach out to your loved ones for assistance. They may be willing to lend you the money you need without requiring a bank account.
  • Social Lending: Platforms like peer-to-peer lending allow you to borrow money directly from individuals who are willing to invest in your loan.
  • Government Assistance: Explore any available government programs or grants that can provide financial support in your specific situation.
  • Community Organisations: Some community organisations offer financial assistance or resources to individuals in need. Research local resources that may be available to you.

Remember, each alternative has its own advantages and considerations, so assess your options carefully before moving forward.

How can I get a bank account?

Having a bank account offers numerous benefits, such as easier access to loans, increased financial security, and convenient money management. If you don't currently have a bank account, here are some steps to help you get one:

  • Research: Compare different banks and types of accounts to find the one that best suits your needs. Look for accounts designed for individuals with poor credit or no credit history.
  • Gather Documents: You'll typically need identification documents (e.g., passport, driving license), proof of address (e.g., utility bill), and proof of income (e.g., payslips) to open a bank account. Prepare these documents in advance.
  • Visit a Bank Branch: Schedule an appointment or visit a local bank branch to open your account. Speak with a representative who can guide you through the process and answer any questions you may have.
  • Consider Basic Bank Accounts: Basic bank accounts are specifically designed for individuals with poor credit or no credit history. They often have no overdraft facility and may come with certain limitations, but they can be a good starting point to establish banking services.
  • Digital Only Accounts: Some newer challenger banks can offer a basic bank account which is 100% managed on your phone. These can provide a convenient alternative to a highstreet branch, especially if you’re a bit tech savvy.

Having a bank account can greatly benefit your financial well-being and provide you with more opportunities in the long run.

Can I get a bank account for free?

Yes, many banks offer basic bank accounts that are free of monthly fees or minimum balance requirements. These accounts are designed to provide essential banking services without additional costs. However, it's important to review the terms and conditions of the account you choose to ensure you understand any potential fees or limitations.

What else do I need to get a loan?

While the requirements may vary depending on the lender and loan product, here are some common documents and information you may need to provide when applying for a loan:

  • Identification: A valid form of identification, such as a passport or driver's licence.
  • Proof of Address: Documents that verify your current address, such as utility bills or bank statements.
  • Proof of Income: Evidence of your income, such as payslips, bank statements, or tax returns.
  • Employment Details: Information about your current employment, including your employer's name, contact information, and length of employment.
  • Bank Statements: Some lenders may request recent bank statements to assess your financial situation and verify your income.

Be prepared to provide accurate and up-to-date information to ensure a smooth loan application process. Some more tech first lenders will utilise Open Banking technology to simplify the process of assessing your affordability.

Will a no bank account loan impact my credit score?

Most loans will impact your credit score. Timely repayments can positively influence your credit history, showing that you're responsible with credit. However, missed or late payments can have a negative impact on your credit score.

It's important to prioritise repaying your loans on time and in full to maintain a positive credit profile. This will increase your chances of obtaining favourable terms for future loans and financial products.

How can I improve my credit score?

Improving your credit score takes time and responsible financial behaviour. Here are some tips to help you on your journey to a better credit score:

  • Pay Bills on Time: Make sure to pay all your bills, loans, and credit card payments on time. Late or missed payments can have a negative impact on your credit score.
  • Manage Credit Wisely: Keep your credit utilisation low, ideally below 30% of your available credit limit. Avoid opening too many new accounts within a short period, as it can negatively affect your score.
  • Review Your Credit Report: Regularly check your credit report for any errors or inaccuracies. If you find any, contact the credit reporting agency to have them corrected.
  • Build a Positive Credit History: Establishing a positive credit history can improve your credit score over time. Consider using a credit card responsibly or taking out small loans that you can comfortably repay.
  • Be Patient: Improving your credit score is a gradual process. It takes time to demonstrate responsible financial behaviour and build a solid credit history.

By implementing these practices, you can gradually improve your credit score and open up more opportunities for better loan terms and financial products.

Frequently Asked Questions (FAQs)

How do I get a loan without a bank account?

To get a loan without a bank account, you will have to explore alternative lending options such as pawn shop lending or borrowing from friends and family.

Are loans without a bank account more expensive?

Loans without a bank account often come with higher interest rates and fees compared to traditional loans. It's important to carefully review the terms and costs associated with these loans before making a decision.

How long does it take to improve my credit score?

Improving your credit score is a gradual process that depends on various factors. It may take several months or even years to see significant improvements. Consistently practising responsible financial habits, such as paying bills on time and managing credit wisely, will contribute to a positive credit score over time.

Written by
Mark Grimley
Head of Partnerships & Take Control Author at Choose Wisely

Mark joined Choose Wisely in 2015. He continues to work in close contact with the providers, brokers and journalists operating in the world of consumer credit.

Important Information.

All of the information in this guide is correct at the time of writing.

If you complete a loan search application on the Choose Wisely website, the rates shown may vary based on your personal circumstances, are subject to status and are available to those aged 18 and over. Rates available range from a minimum of 13.9%APR to a maximum of 1721%APR Representative and loan repayment periods range from 3 to 60 months.

If you need financial advice you can visit stepchange, speak to citizens advice, call the national debtline or speak to

If you've been declined, please refer to your credit report to gain an understanding of why before making further applications.
You can access your credit report for free from Credit Karma, Clearscore or Experian.

Warning: Late repayment can cause you serious money problems. For help, go to