Households facing financial difficulties<\/strong> can now access loans of up to \u00a3800<\/strong> to cover urgent and essential costs. This support is provided by the Department for Work and Pensions (DWP)<\/strong>, and the loan is repaid in monthly instalments directly deducted from the claimant’s ongoing benefits. The scheme is designed to help people dealing with unforeseen and pressing financial needs.<\/p>\n
Budgeting loans are available to individuals receiving certain benefits, including Income Support<\/strong>, Jobseeker\u2019s Allowance (Income-based)<\/strong>, Employment and Support Allowance (ESA)<\/strong>, and Pension Credit<\/strong>. If you are a recipient of Universal Credit<\/strong>, a similar scheme known as a Budgeting Advance<\/strong> is also in place.<\/p>\n
Applications for loans can be processed on the same day<\/strong>, with funds sent directly to the claimant\u2019s bank account. However, some claimants may need to wait slightly longer for approval, depending on individual circumstances.<\/p>\n
To be eligible for this loan, applicants must have been receiving one of the qualifying benefits<\/strong><\/a> for at least six months<\/strong>. The minimum loan amount is \u00a3100<\/strong>, but higher amounts can be granted depending on the applicant’s situation. The exact amounts available are as follows:<\/p>\n
These loans are intended to cover urgent needs, such as:<\/p>\n
However, Universal Credit claimants are subject to certain restrictions. They cannot apply for a loan if their earnings have exceeded \u00a32,600<\/strong> (or \u00a33,600<\/strong> for couples) in the past six months, nor if they are currently repaying a similar loan. For other benefits, loans cannot be granted if the claimant has existing debts of more than \u00a31,500<\/strong> or is involved in industrial action<\/strong>.<\/p>\n
As of 4 December 2023<\/strong>, the DWP has extended the repayment period for Universal Credit<\/strong> recipients to two years<\/strong>, aligning it with the terms available to other benefits claimants. This extension aims to ease the financial pressure on recipients, offering them more flexibility to repay the loan without significant strain on their daily budget.<\/p>\n
Those interested in applying for a Budgeting Loan can do so online<\/strong><\/a> via their Universal Credit<\/strong> account, at the local jobcentre, or by calling 0800 328 5644<\/strong>. Other benefit recipients (outside of Universal Credit) can also apply online or by downloading a dedicated form<\/strong><\/a>.<\/p>\n
Here are the key eligibility restrictions<\/strong> for Budgeting Loans:<\/p>\n