However careful you are with your money, you can still find yourself in a situation that urgently requires cash you don’t have – your boiler breaks down and has to be replaced or your car needs repairs to run, for example. Fortunately, there are ways to get hold of funds quickly.
Your first thought might be to get a credit card or personal loan, but once you’ve applied, you may have to wait a while before you can access the cash.
A credit card could be one of the cheapest options if you need to buy something as you can take out a 0% on purchases card. This doesn’t charge you interest for an introductory period, so it won’t cost you anything as long as you pay off at least the minimum amount each month and pay the card off in full before the initial offer period ends. There are currently deals available for up to 23 months.
If you can wait long enough to receive the card, need to borrow no more than a few thousand pounds, have a strong credit rating and think you can pay it off before the 0% period expires, then this should be your top choice.
You also won’t pay interest on any credit card you make purchases with if you pay it off in full each month, which is useful if you only need to borrow money for a short amount of time. You usually get up to 56 days before you have to make a repayment to avoid interest. Just don’t withdraw cash with the card, as that will cost you straight away.
Once you’ve been approved, which could be instantly if you apply online, it could take as little as three to five working days to receive the credit card in the post, but sometimes this can still be too long for you to wait. And it could take up to 10 working days, or even longer if the credit card provider needs more information to make a decision.
Getting a personal loan can be much quicker, especially if you’re already a customer of the bank where you ask for the loan. This is because you could get the money on the same day your loan application is approved. As with credit cards, approval is often instant if you apply online.
If you decide to ask for a loan with a bank or other lender where you’re not already a customer, you may still be able to get the money by the next working day, but it could take as long as five working days.
Read more about how to apply for a loan.
Secured loans – where you provide an asset such as your home as security – take longer to access as there are more checks the lender needs to make to decide whether to lend to you. It could take at least a few weeks to get the money.
If you need the money within a day and can’t risk having to wait longer, you can consider the options below. They vary in cost and each one has its pros and cons, so the right choice for you will depend on your circumstances.
If you’re lucky enough to have family or friends willing and able to lend you money, you could get the money instantly if they give it to you in cash, or within a couple of hours if they send you the money by bank transfer. If they don’t charge you interest, it won’t cost anything either.
Make sure you’re clear about when they expect the money to be repaid and if they do want you to pay interest. If there are any misunderstandings, they could damage your relationship.
Read our guide to lending to friends if you’re considering it.
If you already have an arranged overdraft with your bank, you may be able to increase your overdraft or limit immediately by applying online or through your mobile banking app or on the phone.
Many banks charge an EAR (effective annual rate) of 39.9%, but some charge more or less. Interest is usually charged daily. Some accounts let you borrow a few hundred pounds interest-free, though.
For example, borrowing £1,200 for 30 days at 39.9% with an HSBC Bank Account, which charges no interest on the first £25, would cost you £32.88. You would pay £33.29 with a NatWest Select current account, which has an EAR of 39.49% and no interest-free buffer.
If you already have a credit card, you may be able to increase your credit limit instantly if you apply online, using your banking app or over the phone. Usually, you need to have had the card and not received an increase for six months to do this – although the exact number of months differs between providers.
You’ll pay no interest if you’re on a 0% on purchases deal or pay the card off in full each month (as long as you use the card to buy things, not withdraw cash).
For borrowing over more extended periods without a 0% on purchases deal, the lowest rate you can get right now is 9.9%. This would cost you £60 in interest if you were to borrow £1,200 and pay off £110 every month to clear the balance after a year.
Buy now pay later (BNPL) schemes offered by companies such as Klarna, Clearpay and Laybuy have become available on many retailers’ websites and let you delay paying for things or pay for them in instalments interest-free. It’s now available in all kinds of places. For example, you can use it to pay for car repairs and parts with car firm Arnold Clark.
With Klarna, you can pay after 30 days or in three instalments. If you choose the instalment option, the first payment is due when you purchase with the other two following at 30-day intervals.
AO.com, which sells household appliances, electronics and more, offers BNPL on products that cost more than £200 through credit provider NewDay. This could be useful if you urgently need to buy an appliance such as a washing machine because you don’t have to pay anything for six months or a year. You can also pay in monthly instalments without paying any interest.
With AO.com, you’ll be charged interest if you don’t pay off the debt by the end of the payment plan.
Although BNPL is valuable, don’t let it tempt you to spend more than you need to or can afford to pay back.
If BNPL or other interest-free credit isn’t available, many retailers offer credit that you pay back with interest. This is relatively expensive, though.
AO.com’s flexible credit scheme charges a representative APR (annual percentage rate) of 19.9%. This means that the lender will offer at least 51% of customers this rate (or a lower one), but you could pay more or less depending on your circumstances.
You can get an immediate loan from a pawn shop by handing over an item of value, such as jewellery, as security. The pawnbroker is free to sell the item to get its money back if you can’t repay the loan by the end of the term. Pawnbrokers don’t typically credit check customers. Loans are often for six months but can be shorter or longer.
Pawnbroker loans are more expensive than many other types of loans. For example, borrowing £100 over six months from Cash Converters at a representative APR of 155.8% would cost you £59.94 in interest.
A salary advance is a relatively new way to borrow. If your employer is signed up with a salary advance company, you can get part of your earnings early, up to a maximum of 50% of your paycheck, through an app or online. It’s then paid back when you get paid.
You don’t pay interest on the loan, but there is a fixed fee for each advance. The amount depends on the company. Salary Finance, for example, charges £1.49 per advance.
Getting a salary advance is cheaper than other types of fast credit, such as a payday loan, and as it’s not considered credit. You won’t be credit checked, but you should use it sparingly as you could end up spending more than you can afford.
These let you borrow small amounts of money for short periods, but as they are a costly way to borrow, often with APRs over 1,000%, you should only use them as a last resort.
Borrowing £100 through Fast Loan UK for 30 days would cost you a hefty £24 in interest. If you borrowed this over six months and paid it off in monthly instalments, you would pay a massive £96.70 in interest. Fast Loan UK quotes a representative APR of 766.18% to borrow £500 over 16 weeks.
Find out more about why you should avoid payday loans.
These are loans secured on your car and are another way to get a loan quickly in England, Wales and Northern Ireland. You can borrow a percentage of your car’s value, which could be up to 70%. The lender owns the vehicle until you pay the money back, but you can carry on using it. You could lose your car if you didn’t repay the loan.
Logbook loans are an expensive way to borrow. For example, Car Cash Point charges a representative APR of 230.7%. A £1,000 loan over three years would cost you a whopping £2,880 in interest.