A pay day loan is normally borrowed before pay day and is expected to be paid on your pay day including interest and costs. So, say you borrow R500 for 26 days you will end up paying R679.00 on your pay day. Sounds like a good way of borrowing money for an unexpected problem that may arise mid-month.

You may think there is no harm there, however the following month yet again you find yourself in another predicament and you need to get another pay day loan. However this time the loan company increases your limit to R1000 and due to temptation you take up the offer. Now your repayment for this month is R1288.00. The cycle goes on an on until you can no longer afford to pay back the loan.

Some aspects to consider when taking out a pay day loan:

High interest rate

Read the terms and conditions

Know the cost of credit

Fees charged


We have some helpful tips below should you find yourself caught up in the pay day loan trap:

  1. Cut down expenses to cater for your pay day loan
  2. Create a budget and stick to it
  3. Consider getting a roommate or moving to a cheaper place
  4. Saving money on fuel by using public transport
  5. Work with lenders to come up with a workable solution


These are just some of the ways you can use to save money and catch up on those pay day loans.

Pay day loans can sometimes lead to over indebtedness. Should you feel you can no longer cope please don’t hesitate to contact Smart Debt Advisors  on 086 006 1008 or visit www.smartdebtadvisors.co.za