Rolling a loan forward buys time, but usually at a price. The rules limit how far it can go.
Need to know
- A rollover extends the repayment date, usually in return for paying the interest so far.
- FCA rules limit payday loans to two rollovers.
- The total cost cap still applies, so interest and fees can’t exceed the amount borrowed.
- Taking a new loan to repay an old one can keep you in a cycle of borrowing.
If you can’t repay a payday loan on the due date, a lender may offer to roll it over or extend it. That can help in a short, genuine pinch, but repeated rollovers are one of the main ways payday debt gets out of hand.
What a rollover is
A rollover moves your repayment date later. Typically you pay the interest due so far, and the amount you borrowed carries on, building more interest until the new date.
The FCA rules
- Two-rollover limit: a payday loan can be rolled over no more than twice.
- Total cost cap: interest and fees across the original loan and any rollovers can never exceed the amount you borrowed.
- Information: before a rollover, lenders must explain the cost and point you to free debt advice.
The cost of rolling over
| Situation | What happens |
|---|---|
| Repay on time | The loan ends; you pay the original cost |
| Roll over once | You pay interest so far and keep paying interest on the loan |
| Roll over twice | More interest, still within the total cost cap |
| New loan to repay the old one | A new loan with its own costs, often a sign of a borrowing cycle |
Important
Borrowing again to repay a payday loan rarely solves the problem. If it’s happening more than once, it’s time to speak to a free debt adviser. Late repayment can cause you serious money problems. For help, go to moneyhelper.org.uk.
Better options when you can’t repay
- Talk to the lender early about a repayment plan rather than a rollover.
- Get free debt advice from MoneyHelper, StepChange, National Debtline or Citizens Advice.
- Protect priority bills like rent and council tax first. Our guide to continuous payment authorities explains how to stop automatic card payments if needed.
Helpful step
Ask any lender for the total amount you’ll repay in pounds under each option. Seeing the figure side by side makes the choice clearer.
Breaking the cycle
If you keep needing short-term credit, the underlying gap between income and spending needs attention. Our guides to alternatives to payday loans and struggling to repay suggest where to start.
Your questions answered
Can a lender refuse to roll over my loan?
Yes. A lender doesn’t have to offer a rollover, and it must check that extending the loan is in your interests.
Is an extension the same as a rollover?
Lenders use the terms differently, but both move the repayment date later. Ask exactly what it will cost in pounds before agreeing.
What if I still can’t repay after two rollovers?
Contact the lender to discuss a repayment plan, and get free debt advice. Lenders must treat customers in financial difficulty fairly.
This guide is general information, not financial advice. Late repayment can cause you serious money problems. For help, go to moneyhelper.org.uk. We don’t arrange loans or work with lenders. Before borrowing, check the lender is authorised on the FCA register, and consider free debt advice from MoneyHelper, StepChange, National Debtline or Citizens Advice.