Short Term Loan Lenders

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I would guess that 10 or 15 years ago the terms “payday loans, short term loans and direct payday lenders” didn’t exist.

I’m not sure how these terms and the type of organization and products offered by these organisations crept into our vocabulary and day to day lives.

I remember quite clearly hearing the term payday loan and having no idea what it meant or what the companies offering these loans did. It seems quite amusing thinking back and having to ask other people what the term meant. Hardly a day has gone by in the last few years without the newspapers and news websites running stories about these organisations and the loans they offer.

If the term Payday Loans had become familiar, the term short term loans certainly hadn’t. I think it came about when people were becoming concerned about payday loans and payday lenders and so the lenders decided to start calling themselves short term loan lenders, or direct lenders. I think they thought it sounded more professional and impressive.

But there is a difference between single installment payday loans and other short term loans and I will give brief explanation and description.

A single installment Payday Loans is designed to cover a short period of time between point x and the end of the month / week before the borrower is paid his or her salary. It is designed as a sort of emergency loan. The repayment is intended to be a single payment consisting of all of the capital and all of the interest and fees for the loan. It is a single payment loan.

A short term loan, while including single installment payday loans, is more commonly a multi installment loan, being a loan that is repaid in multiple repayment amounts on multiple days. An installment loan is a loan that is divided into pre agreed payment amounts that include a portion of capital and a portion of interest. The installment typically is all the same or almost the same and the repayments are normally made on the same day each month or week.

But not all installment loans are short term loans. A mortgage is an installment loan, but is certainly not a short term loan.

So what would that make a loan that is for, say, 6 months and has the same repayment each month? I would call that an installment loan or a short term loan. So there are big cross overs with teh different loan types and their descriptions.

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

Representative Example: Representative 1286.98% APR on a loan of £300.00 with 5 monthly repayments of £101.03 Total amount repayable £505.13 Annual interest rate (fixed) 290% Maximum APR 1351%

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Author: Internal Marketing Department