A short term loan is for people who require a cash advance repaid over a short period. They may be less than 30 days in duration normally, repaid on the next payday, or last for several months.
Short-term lending is not intended for sustained borrowing over long periods. If you find yourself in this situation then get in contact with your lender as soon as possible.
The purpose of this type of loan is to act as a short term solution to temporary cash flow problems experienced by consumers. Often they are used to deal with unexpected expenditure.
Firms will charge fees, such as interest for this service. The total amount that any customer is expected to pay is capped.
The ‘APR’ on loans of short duration, less than a year, can often be very high. This has attracted public and media attention. With a UK price cap, and other regulations, no one will ever pay back thousands of percent in interest suggested by the ‘APR’. All lenders are obliged to provide information such as the APR despite it being of little use to the customer.