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Are you facing a short-term cashflow issue?

When you’ve got essential costs to meet, payday can seem a long way off. Below are some options that you may wish to explore.

Ask for a pay advance

If you need money before payday, it’s always worth asking your employer if they’ll give you an advance on your wages. Be honest and explain that you are having a cash-flow problem and how an advance would help you manage.

Your employer may even have a hardship loan system for employees who are struggling financially.

Apply for an advance benefit payment

If you need help to pay your bills or cover other costs while you wait for your first Universal Credit payment, you can apply to get an advance.

The most you can get as an advance is the amount of your first estimated payment.

You can apply for an advance payment in your online account or through your Jobcentre Plus work coach.

For further details, see Get an advance on your first payment on the website.

Using an authorised overdraft

If you have a current account you might be able to get an authorised overdraft from your bank.

These can be fairly expensive (although there are some interest-free overdrafts) but it will usually be cheaper than using a payday loan - as long as you stay within the overdraft limit.

An unauthorised overdraft, which is an overdraft not approved by the bank, can be very expensive and lead to serious money problems.

Borrowing from a credit union

A much more affordable alternative to a payday loan is a loan from a credit union.

There’s a cap on the amount of interest they can charge which reduces the overall cost of borrowing.

See Borrowing from a credit union on the MoneyHelper website for more information.

Deciding on the best type of credit for you

MoneyHelper has created a simple guide to choosing between different types of credit, including loans, overdrafts and credit cards.

For more details, see What’s the best credit option for you?

Borrowing from family and friends

Borrowing emergency money from a family member or a friend can help you avoid the risks that go with payday loans.

But do make sure that both you and the person you’re borrowing from take the time to:

  • Put your agreement in writing
  • Work out a budget and a repayment plan
  • Discuss what will happen if you’re late paying it back or don’t repay it at all

Food Banks

Most food banks in the UK are run by the Trussell Trust, a charity run with the help of volunteers and local communities. Someone who knows about your situation, like a doctor or advice worker, may be able to give you a referral form so you can access support from a food bank. A food bank could then provide you with some food to last for a few days or more.

You can find your nearest Trussell Trust Food Bank using their interactive map.

Help through your local authority

If you’re struggling to pay for essentials like food, heating and clothes you might be able to get help from a local welfare assistance scheme.

Assistance from the council is usually limited to applicants who receive means-tested benefits and can show an urgent need for support.

They vary from area to area and can provide, for example, vouchers, pre-payment cards, furniture or white goods and food bank referrals.

If you are claiming a means-tested benefit and you feel there is a risk to the health and safety of your family, or you urgently need an essential item you cannot afford,

Check your council’s website for details of their emergency assistance. Usually this information is in the section titled ‘Benefits’.

Need further advice?

Before contacting the service, we encourage you to see the advice guides and tools located on the Financial Wellbeing pages as these may answer your query without the need to wait for an appointment.

If you do need to speak with someone, please see our advice on booking an appointment with the RCN Welfare Service.