Understanding the APR

The APR stands for Annual Percentage Rate and is the interest payable on the amount borrowed expressed as an annual rate charge. All lenders have to tell you what their APR is before you sign an agreement.

All lenders are required by law to display a Typical APR on their adverts and websites. The Typical APR has to show the APR that at least two thirds (66.6%) of our customers can expect to get on their loan.

In our case 66.6% of our customers borrow at a rate of 30% for a 28 day period. This means that if this figure were annualised, it would equal 2,964.4%

In the short term loan market the APR figure has limited value as the duration of the loan is too short. This is why APR figures can end up as thousands (or even millions) of percent when the loan is for just a few days.

With 1 Month Loan we like to keep it simple while still obeying the law. So in simple terms you will pay the same £30 per £100 borrowed whether you have the loan for 1 day or 30 days.

The problem with APRs