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A wise guide to…

Getting a Cash Advance

Cash advances are small loans people can take out quickly, without much paperwork to go through. If you have an issue with cash flow and need to pay for something before your next paycheck comes in, this loan can help fill the gap. It’s important to always do careful research before taking out a cash advance and compare lenders thoroughly.

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Representative 99.8% APR (fixed). Representative Example: If you borrow £500 over 52 weeks at a Representative rate of 99.8% APR and an annual interest rate of 99.8% (fixed), you would pay 52 monthly instalments of £13.41. The total charge for credit will be £197.32 and the total amount payable will be £697.32.
Choose Wisely is a trading style of Choose Wisely Limited and is a free to use price comparison website. Choose Wisely Limited is authorised and regulated by the Financial Conduct Authority as a credit broker not a lender, firm reference number 730574 and is registered with the Information Commissioner’s Office number Z3106681.

A quick, easy way to get a cash advance loan today.

  • Borrow from £300 to £10000.

  • Choose between lenders who have accepted your application.

  • Absolutely no fees, ever.

Representative 99.8% APR (fixed).

How to get a cash advance loan in 3 simple steps.

Affordability assessment.

1 form - takes 2 minutes to complete and your data is 100% secure.

Compare products.

Choose from lenders that have accepted your application.

Speedy finance.

If approved, the cash can be in your account in as little as 15 minutes.[†]

Table of contents

Written by Inez Miedema
Read time: ~5 mins
Published: 4th March 2020 Updated: 9th September 2020

Every once in a while we could all do with some help, particularly with money. When working to a tight budget, it’s extremely easy for an unexpected event to leave a person worrying about their finances. Sometimes things break, or you need to buy an item you weren’t expecting. To help people deal with these unforeseen costs, cash advance loans were created.

As with any financial choice, it’s important to make sure you are well informed to be able to make a decision that will help you and not cause any headaches in the future. This article will explain exactly what cash advance loans in the UK are and if it’s the right choice for you.

What is a cash advance?

A cash advance is a type of short-term loan. It’s quite a fast way to get access to a small amount of money, but can also be an expensive loan to take out, which means it’s important to understand exactly what you’re signing up for. Traditionally, mini credit cash advance loans are given by most credit and charge card providers. Taking an advance on a payment card, for example, would be like normally withdrawing money from an ATM, apart from the money doesn’t come from your bank balance, but from a credit limit instead.

A person who has received a cash advance loan is able to withdraw their cash in three ways:

  • From an ATM
  • From a bank counter
  • Over the counter at a post office

Depending on your circumstances, you might be eligible for up to and above £1000 but this really depends on your credit history and current situation. Fast cash advance payday loans for unemployed people are also possible, this type of loan tends to be a bit less strict on lending requirements, meaning that people who have an issue with their credit score might still be able to access these funds, but they will be expensive.

If a lender is regulated, cash advance loans with no credit check aren’t possible, all regulated lenders will carry out a full credit check before issuing funds. Look carefully at a lender and their reputation if they offer loans without any form of credit check at all, and make sure their terms fit what you need.

Nowadays, many UK direct lenders can provide you with cash advance payday loans too. This means when researching for loans, you can concentrate on a wider market than just what the traditional lenders, credit card providers and highstreet banks have to offer.

What are cash advance loans?

Cash advance loans were created to give people access to small amounts of money quickly and easily. From time to time, life throws things at us that we weren’t expecting. Boilers and cars can break down, homes need fixing, and utility bills can total more than expected. These are just a small number of examples for when cash advance loans are designed to be used.

Because of the speed with which people can receive the money, they are very popular in the UK, with lots of lenders to choose from. So shop around before making a decision to make sure you get the best rates.

Why cash advances can be expensive if you’re not careful

Cash advance loans in the UK are one of the easiest ways to get access to cash quickly. However, the cost of this speed can be a heavy one if you are not paying careful attention.

Watch out for these expenses:

Cash advance fees

This form of fee is issued by card providers. There can be two ways this is taken, either as a flat amount for every advance, or as a percentage of the amount you are advanced.

ATM or bank fees

The financial institution that deals with your advance issues this fee. This can either be the ATM owners or the bank that handles the transaction.

Interest

Interest has to be looked at carefully because it can cost you in two different ways. The first one is that a borrower will often be charged a higher rate on advances compared to purchases. The second is that interest costs start straight away, and you will build up charges as soon as you use the cash advance.

What to use a cash advance for?

This is not an exhaustive list, but provides common reasons people can need a cash advance.

  1. Emergency home repairs:

    • Leaking roof

    • Burst water pipe

    • Broken washing machine

    • Boiler breakdown

  2. Unexpected bills:

    • Bill costs can vary hugely between summer and winter months, making it hard to plan and budget accordingly.

  3. Transportation:

    • If your car breaks down, or your main form of transport isn’t usable, you might need to pay to still get to the places, e.g work.

How do cash advance payday loans work?

There are a lot of providers in the market for cash advance loans in the UK, and as with most things in life, some are better than others. This largely depends on your situation, so make sure to compare different loan types and what the direct UK lenders have to offer.

The process will vary between different providers, but to get started:

  • Fill out a Choose Wisely application form, it takes only a few minutes
  • You will be provided a list of lenders that have approved your application in principle. Conduct thorough research to find the best deal for your situation
  • Apply to the lender and fill in an application form. This will usually involve submitting:

    • Personal details

    • Contact details

    • Employment details

    • Financial details

    • Documents to prove your identity

  • If accepted, your funds will be released and can be in your bank account very quickly, depending on a specific lender’s policy
  • Repayment of loans is mostly installment based, but you could pay it off as a lump sum if you are able too

How much can I borrow with a cash advance loan?

As mentioned above, this depends largely on your credit history and current situation. In general, this can be between £50 - £1000. There are some people with a big disposable income and a record of regularly keeping on schedule with loan repayments who will be able to secure higher amounts.

Get the right payday loan

For more information on payday lenders and how to get accepted for a payday loan, read this wise guide.

How to pay off cash advance loans?

Depending on the size of the loan, some borrowers are capable of repaying them in one installment, which is often when their next paycheck or payday is. To avoid as many additional fees as possible, a borrower would ideally pay the loan off sooner rather than later. However sometimes this is not possible, in these situations the repayment can be broken down into smaller chunks over a longer period of time.

Where to go if you want to borrow more money?

Choose Wisely compares different loan types from lenders across the market. If you need access to more money, there is the option of guarantor loans, payday loans, peer to peer loans, as well as others. To find out more about what loan suits your needs the best, fill out an application form.

Cash Advance Loans FAQs

What is the difference between a cash advance and payday loans?

There are two key differences between cash advance and payday loans.

1. The provider of the loan.

Credit card companies used to be the common lender to issue cash advances, where the borrower was allowed to directly withdraw cash funds from their credit card. Payday loans traditionally are given out by specialist payday or short term lenders. Today the terms are often used interchangeably when talking about short term loans.

2. The contract type.

You only have to agree and apply to getting accepted for a cash advance once - like with an overdraft. Once you’ve been accepted you can dip into it when you need it and pay interest / fees only when you do. Whereas, you’d have to apply for a new payday loan separately every time you need cash, and you will receive the cash directly in your bank account. This means you are charged as soon as you take out a payday loan.

Is it a good idea to use a cash advance?

There is no straight answer to the question if using a cash advance is a good idea for you. Everyone’s situation is different. It is however important to remember that using a cash advance on a credit card is possibly the most expensive form of lending. You might be better off with a different type of loan or overdraft, which you can compare on Choose Wisely.

What will you need to apply for a cash advance?

Each lender’s process is slightly different, but most commonly you will need to be a UK resident, have enough disposable income, an active bank account and be in employment.

Written by
Inez Miedema
CMO & Take Control Author at Choose Wisely

Inez came on board in the Summer of 2019. Her main focus has been helping as many people as possible find our website through online marketing, writing content and partnership deals. She boasts 6 years of FinTech experience with other brands and has an in-depth knowledge of our customers.

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Important Information.

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

Rates shown are quotes 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 3.9%APR to a maximum of 1575%APR Representative and loan repayment periods range from 3 to 60 months.

[*][†] Once accepted, your loan can be transferred to you in as little as 15 minutes. The time that it takes for the loan to show in your bank account will depend on your lender and your bank.

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

If you've been declined, please refer to your credit report to gain an understanding of why before making further applications.
Your score can be accessed for free via any of the main credit reference agencies such as Credit Karma, Clearscore or Experian.

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