What to do: Can’t pay back your payday loan

The worst has happened you loaned money and now you can’t pay it back immediately. Don’t despair we will look at a few options available to you and see what you can do to return to financial health. The most important thing is to not ignore the problem, and hope it will go away.


  • They have to treat you fairly, and must consider freezing interest or suspending charges
  • Suspend debt recovery if you have developed a repayment plan
  • Direct you to sources of free and independent debt advice
  • Negotiate small token payments if it affects your ability to buy food, pay rent etc.


The recurring payment or continuous payment authority is what allows the lender to take money from your account. You are allowed to cancel this, but remember to tell your lender that you are doing this.
If you have instructed the bank to cancel this and money is still taken afterwards the bank has to give you a full refund by law.
You will still owe the debt and the lender can continue to charge interest and fees but it will buy you some much needed time, and give you a chance to get advice to help deal with the loan, or develop a repayment plan.


It is very likely your lender will suggest you roll over your loan. Do not do this as you will incur extra interest and owe even more money. Insist on a repayment plan instead. If you have already rolled over your loan, bear in mind it’s against the law for a lender to roll over your loan more than twice.


Debt advisers can assist you to manage your debt and furthermore they can also negotiate with the lenders on your behalf. Once again inform your lender that you are using a debt adviser, they must then give you a reasonable amount of time before handing you over to a debt collector. Below is a list of free, confidential debt advice services:

  • “Flexible Debt Solutions” Debt Charity
  • National Debtline
  • Citizens Advice, England, Scotland and Wales


It is very important that you keep copies of all emails and letters with regards to any correspondence you have with the lenders, banks etc. Also take down names, times and phone numbers of anybody you speak to over the phone. This is all evidence you may need if you have to make a complaint.