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Payday loans can sound pretty attractive. If you’ve run short of cash, or there’s an unexpected emergency and you need money in a hurry, a payday loan could be just what you need.

After all, you’re only borrowing the money until you get paid, so you aren't getting yourself into any long-term debt. Unfortunately, this isn't always the case. 

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Why choose Satsuma?

Money in 1 hour

Once approved, hourly pay-outs between 6am - 11pm

No hidden fees

Only ever pay back the amount we agree upfront

Our reviews

Our customers rate us 4.8 out of 5., June 2016 

How does SmartCheck work?

We check your info

It's not a full application so we only need a few details

Protect your credit score

No matter the result, it won't affect your credit score unless you choose to apply

Give you your result

You'll find out in 60 seconds and we'll tell you how much you could borrow. We'll need to check your details if you choose to apply*

What is a payday loan?

Payday loans are short term loans that need to be repaid in a single lump sum, along with the interest and any other fees the lender has charged. 

Normally, the full loan must be repaid within 30 days of you taking out the loan. As the name suggests, this is usually on the borrower’s next pay day.  

Despite the high interest rates and fees, a payday loan can work out well if you’re certain you’ll have the money available on the due date to repay the loan in full. However, many people find (to their cost) when it’s time to repay, their circumstances have changed and they can’t manage a lump sum payment. 

Repayment problems can arise due to the borrower underestimating their outgoings for the next month or from something unforeseen (and costly) cropping up. Perhaps it’s a weekend away with the family, which seemed low-cost at the outset but ended up costing the earth, or an overlooked MOT which, more often than not, means expensive repairs.   

When things like this happen, as they almost always do, the £500 earmarked to repay a payday loan suddenly becomes impossible to find.

This is when the problems start.  

If the loan isn’t repaid in full, penalty fees are added by the lender and the sum owed suddenly begins to grow, making it even harder to find the cash to repay the original loan. 

How do payday loans work?

  • Payday loans are quick but expensive loans paid directly into your bank account, usually on the same day.
  • Unlike other types of finance, a payday loan must be repaid as one lump sum payment, usually within 30 days.
  • They’re called payday loans because they’re designed to cover a temporary shortfall or financial emergency until the borrower’s next pay day.
  • We’ll look at this in more detail below, but a payday loan should not be confused with a short term loan. Short term loans are paid back over a much longer period (up to a year) and are paid back in smaller, more manageable instalments.

Why do people choose payday loans?

Easy access if you have bad credit.

If you have a poor credit history, payday loans may be one of the few ways you can access credit. High street banks and building societies are unlikely to lend to borrowers with low credit ratings. However, payday loan companies will often take the risk because of the smaller amounts involved and the fast payback time.   

Unfortunately, this often means payday loans are accessed by people who cannot afford them and who may already be burdened with debt. In many cases, the new loan can't be repaid and the borrower is caught in a spiral of increasing debt. 


When the unexpected happens, there’s always a chance it will happen a week or so before pay day, just as the last of your spare money is running out. Sound familiar? In these circumstances, a payday loan can seem like the perfect solution to a temporary shortfall in cash.


Access to easy cash can often be seen as a way to quickly fill a temporary, or even permanent, financial hole. Unfortunately, taking a short term approach to debt can backfire as unexpected fees quickly mount up, leaving the borrower worse off.

Fast cash

The final reason people opt for this type of loan is because they are paid out instantly. For whatever reason, some borrowers need money quickly and, with a payday loan, they know they’ll receive it almost instantly.   

It’s worth knowing that a short term loan from Satsuma is also paid into your bank account on the same day, usually within an hour. This means you can access cash just as quickly, but without all the hidden fees and charges that can come with a payday loan.

What’s so bad about payday loans?

You may have read or heard stories about people becoming trapped by mounting debts after taking a payday loan. People who couldn't even afford their repayments soon found the added fees meant they had to repay many times the amount originally borrowed. 

While there were many unfortunate cases like this, the negative media publicity helped convince the government to bring in new legislation. In January 2015, our regulator (the Financial Conduct Authority), introduced price caps on the fees charged by loan companies offering high cost, short term credit. 

The new rules mean the daily rate of interest charged must not exceed 0.8% per day. They also limit default charges to no more than £15, as well as capping the total cost at 100% of the original amount borrowed. Put simply: borrowers must never have to pay back more in charges and interest than the amount they borrowed at the outset.

 At Satsuma, we’re proud to say we’ve never charged late or missed payment fees. You can find out more about our fees by clicking here.

Why you need an alternative to payday loans

Despite the government’s changes, there are still issues surrounding payday loans; in particular, the fees being charged by lenders.

This means payday loans aren't for everyone and ultra-short term borrowing in response to an unexpected event can still lead to long-term debt.  

The total cost of the loan and the associated fees are why you should be looking for an alternative to payday loans. But what choices do you have?

Borrow from family and friends

Understandably, we’re all reluctant to do this. In fact, very few of us will ever ask family or friends for a loan. Instead, we’ll either manage and go without, or look for finance elsewhere. Of course, as well as the social awkwardness, it may be that those close to you are simply not in a position to help financially, even if they wanted to.

 Another payday loan alternative is to approach your bank or building society for a loan or overdraft. As we’ve already discussed, high street lenders are reluctant to do this, especially if you’ve had credit problems in the past. 

Fortunately, we may have a solution...

Short term loans - our payday loans alternative

A short term loan from Satsuma is the affordable and practical payday loan alternative you’ve been looking for.  

First off, you can apply for a loan online. No need to book an appointment or visit a branch. Before you submit your application, you can use our loan calculator to see exactly how much you will be required to pay back. You only pay back the sum of money you borrow, plus the interest. You never have to pay any hidden charges or fees, even if you miss a payment. This makes our short terms loans very different from those offered by payday loan companies. 

Another big difference is you have plenty of time to pay your loan back. You can choose to repay your loan over any period from three months to a year, and you can also choose whether to repay monthly or weekly; whichever is the most convenient for you.

We transfer the money to your account via Faster Payments. If you’re accepted between 6am and 11pm, the funds normally land in your account within the hour, which can be really useful if you need the money for something urgent.

Is this a same day loan?

‘Same day loan’ is a catch-all term used to describe many different types of finance. Since the money you borrow from Satsuma is usually credited to your account within the hour, it’s fair to say your loan could be described as a same day loan. Subject to approval, you’ll almost certainly have the money on the same day your application is submitted.

How do I repay my Satsuma short term loan?

Repaying your short term loan is very straightforward. We collect repayments by Continuous Payment Authority (CPA). 

You choose a convenient day of the month or week, and we simply collect your repayments automatically from your debit card. If we’re unable to collect your repayment, we’ll always get in touch. We certainly won’t try to collect the repayment again without speaking to you or attempt to collect more than your contractual repayment.

It’s this flexibility that helps make us the smart alternative to payday loans.

What happens if my circumstances change?

We understand personal circumstances can change at any time; for example, you might suddenly suffer an unexpected drop in income. Our Customer Care team is only a phone call away, so if you’re struggling to pay on time, let us know. 

We want to talk to you and help you get back on track. Unlike other companies, we won’t put you through to a robot or a never-ending series of automated menus. The help and support we offer is provided by real people in our UK-based call centre. Our team wants to get to know our customers and their circumstances, and help them achieve a positive outcome.

Remember, unlike many other lenders, we’ll never charge you a penny more than you agree upfront. Not even if you miss a payment or pay us back late. We don't charge fees or have any hidden charges. We only charge you interest and you know exactly how much that will be from the ge

Isn't a short term loan the same as a payday loan?

Not at all. There are many differences. With a Satsuma short term loan:

  • You don’t have to pay the loan back in one lump sum
  • You know exactly how much you’re borrowing before you submit your application
  • The cash will be in your bank account the same day your application is accepted
  • You’ll never be charged any fees
  • You can choose to pay either weekly or monthly
  • You can repay your loan in easy-to-manage instalments over a period of up to a year
  • You can borrow up to £1,000, even if you’re a new customer
  • Our friendly Customer Care team is always available if you run into difficulties
  • You know you’re dealing with a reputable and established company as we’ve been around since 1880.

I've got a poor credit history, what is an affordable payday loan alternative for me?

We realise many people looking for a loan may have had credit problems in the past. You might think a payday loan is your only option, but we’re here to help.

Whatever your credit history and personal circumstances, we’ll do all we can to help. We’re happy to consider all circumstances, but as a responsible lender, we won't loan money to anyone we don’t think will be able to meet the repayments.  

In most cases, we should be able to help, even if you have a poor credit history.

Do I need a guarantor for my short term loan?

Unlike many other finance companies, we won’t ask you to provide a guarantor for your loan. All our loans are on a no-guarantor basis. 

Can a short term loan help repair my credit rating?

When you’re accepted for a Satsuma loan, or by any other lender, the details of the loan and your repayments are recorded by credit reference agencies, such as Experian, who compile your credit report. 

Meeting your commitments and repaying your loan as scheduled will be recorded in your credit file. Making your payments on time can increase your credit score. This might make it easier for you to apply for loans and credit cards from high street banks and building societies in the future.

How do I apply for a loan?

As a first time Satsuma customer, you could borrow up to £1,000 and repay it over 3-12 months in manageable monthly or weekly instalments. Click here to apply.

We’ll tell you the total cost of your loan up front with no catches or hidden charges. You will never owe a penny more than you agree upfront, even if you’re late with a repayment or miss one entirely.

If you’re approved through our online application process, the loan will be in your bank account within an hour, provided your application is processed between 6am and 11pm.

Still not convinced? 

At Satsuma, we’re confident that we’re the payday loans alternative you’re looking for. But, if you’re still unsure, feel free to give our UK-based Customer Care team a call on 0800 694 0004 and we’ll answer any questions you may have about our short term loans.

* Approval for a Satsuma Loan is subject to successful completion of affordability, fraud, identity and money laundering checks. Satsuma Loans are only available to UK residents who are at least 18 years old and have a valid UK bank account and debit card.