Lender in Focus 13.4: Pounds to Pocket how repayments work & APR

pounds to pocket apr

pounds to pocket apr

If you want to compare Pounds to Pocket with other lenders, the Pounds to Pocket APR is a good place to begin.

Before taking out any loan, it is important to ensure that you fully understand all of the potential costs involved. In order for you to be able to make cost comparisons with other lenders, loan providers who offer short and medium term loans should always inform you of what their APR is.

Payment schedule

Pounds to pocket offers borrowers the opportunity to apply for both short and medium term loans.

Both new and existing customers are able to borrow between £200 and £2,000. If you want to take out a loan with Pounds to Pocket, you can opt to pay it back over a period of 6 to 12 months.

With Pounds to Pocket, you are also able to apply for a ‘Top-Up’ before repaying your current loan. If you are approved for a ‘Top-Up’, your current loan will be rolled into a new loan. This new loan will have an increased loan amount and longer repayment term.

Generally, your new loan will cost you more because of the larger amount borrowed and the longer repayment term.

How are repayments taken?

If you decide to take out a loan with Pounds to Pocket, you can choose from two repayment options:

Payment through your debit card

If you opt for this method of payment, your scheduled payments will be taken from your debit card on your due dates. This way, you do not need to worry about remembering to send in payments every time they’re due. This is also known as Continuous Payment Authority (CPA).

Direct debit authorisation

If you do not have a debit card, your scheduled repayments can be automatically withdrawn from your bank account on your due dates.

How much will my repayments be?

Your repayment amounts will depend on how much you borrow and the term of your loan. You can get an estimate of the amount of interest you will pay on your loan and what your repayments could be, by using the Pounds to Pocket LoanBuilder.

Will I be charged less if I repay my loan early?

Yes. If you repay your loan early, you will only pay the amount of interest that you owe on your outstanding balance.

For example, if you chose a 7-month loan term and decided that you wanted to repay your loan in full, in only 3 months, you would only pay the interest for the 3 months that you had the loan.

If you opt to repay more than is due on your scheduled repayment date or make any extra repayments, this will reduce your outstanding loan balance and therefore will reduce the amount of interest that you owe.

Pounds to Pocket does not charge fees for repaying your loan early.

Can I change my repayment dates after I have taken out a loan with Pounds to Pocket?

You should only take out a loan if you are sure that you will comfortably be able to make the repayments. If your financial situation changes and you think that you may not be able to make a scheduled repayment, you should contact Pounds to Pocket on 0800 016 3106.

A member of the Pounds to Pocket team will then discuss the options available to you. Pounds to Pocket may be able to defer your upcoming repayment to a later date but this depends on your situation.

If you miss a repayment, Pounds to Pocket will charge you a late fee of up to £15.

Table of borrowing

The table below contains examples of what you could expect to pay back if you took out a loan with Pounds to Pocket:

Loan amount6 months9 months12 months
£200.00£338.70£362.79£381.48
£500.00£846.78£907.02£953.76
£1000.00£1693.50£1814.04£1907.40
£1500.00£2540.28£2720.97£2861.16
£2,000.00£3387.06£3627.99£3814.80

 

What is the Pounds to Pocket APR?

APR means Annual Percentage Rate.

The Pounds to Pocket APR is a good way to compare Pounds to Pocket’s interest costs with those of other lenders.

The Pounds to Pocket representative APR is 277.5%. Although the representative APR is a good way to compare lenders, not all customers who apply for a loan with Pounds to Pocket will get this rate.

How does the Pounds to Pocket APR compare to the APR of other lenders?

CashLady has picked out some lenders at random so that you can make a comparison:

Quickquid

QuickQuid’s representative APR is 1295%.

For example: If you borrowed £200 for 84 days, you could expect to repay a total of £334.40, including interest of £134.40.

PaydayUK

PaydayUK has a representative APR of 1178%.

For example: If you took out a loan of £300 for 3 months, you could expect to pay back a total of £492.63.

WageDay Advance

WageDay Advance has a representative APR of 1294.1%.

For example: If you borrowed £200 for 28 days with WageDay Advance, you could expect to repay £244.80 in total, of which £44.80 would be interest.

Total loan value repayment cap

As an FCA-authorised and regulated lender, Pounds to Pocket must adhere to these rules:

  • Fees and interest per day must not exceed 0.8% of the amount borrowed
  • Default fees must not exceed £15, although interest can still be charged after default (but only at or below the initial rate)
  • Borrowers will never pay more in interest and fees than 100% of the total amount they borrowed.

As a result, you should never pay back more than twice of what you borrow from Pounds to Pocket.

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