Short-Term Loan In Germany [Payday Loan]

Key takeaways

• A short-term loan (payday loan) is a credit you borrow for a short period of 30 to 90 days.
• Earlier, your Schufa score didn’t impact the payday loan conditions. However, from November 20, 2025, all short-term and mini-loans require formal credit-worthiness checks (EU Consumer Credit Directive 2023/2225) [1, 2].
• You pay high interest on short-term loans. The effective interest rate varies from 13.4% to 14.8%. However, as you take the loan for a short period, the total interest you pay is not very high.

This is how you do it

• You should get a short-term loan only if it’s an emergency.
• Try to get a loan from your friends or family in an emergency.
• You can apply for a payday loan on one of the portals, Vexcash and Cashper*.
• If you need the money within 24 hours, you pay an extra fee at these portals.

Table of Contents

What is a Short-term / Payday loan in Germany?

Short-term loans are credits given for a short period of 30 to 90 days. They are also called Payday loans or Kurzzeitkredit in German.

The amount you can borrow in a short-term loan varies from 100 € to 3000 €. Moreover, payday loan providers charge a high interest rate, between 13.4% and 14.8%.

What are the eligibility criteria for payday loans in Germany?

What are the eligibility criteria for payday loans in Germany?

• You should be at least 18 years old.
• You have a German home address.
• You have a German bank account.
• You have a stable monthly net income of at least 400 € (Cashper) or 500 € (Vexcash).
• People with any German visa can get short-term loans.

Best bank accounts in Germany ->

NOTE: Earlier, your Schufa score didn’t impact the payday loan conditions. However, from November 20, 2025, all short-term and mini-loans require formal credit-worthiness checks (EU Consumer Credit Directive 2023/2225) [1, 2].

Lenders usually limit the loan amount for new customers. However, the credit limit will increase if you repay the loan on time.

How can you apply for a payday loan in Germany?

You can apply for a payday loan on one of the following platforms.

• Vexcash
• Cashper*

You can apply in two steps.

• Enter all the required information online (personal information, bank details, income, and expenses).
• Identify yourself using videoIdent.

Wait until the lender processes the information. Once the lender approves your loan, it may take up to 3 days for the loan to appear in your bank account.

Don’t confuse short-term loans with instant loans. Instant loans are normal installment loans like personal loans, car loans, etc.

Best short-term providers in Germany

	Cashper*	Vexcash
Loan amount	100 € to 1500 €	100 € to 3000 €
Effective interest rate	13.40% and 13.60%	14.82%
Loan term/duration	15 / 30 / 60 days	30 / 60 / 90 days
Fees	No processing fee.	No processing fee. Extra fee to get money within 24 hrs.
Limit for new customers	No limit	1000 €
Bank behind it	Novum Bank Limited, Malta	SWK Bank
Trustpilot rating	4.5 rating by 8,501 people	4.1 rating by 206 people

Are short-term loans expensive?

Whether short-term loans are expensive depends on how you look at them. Yes, you pay a higher interest rate than on personal or other types of loans. However, you pay high interest for a short period.

So, the total interest you pay on a short-term loan is lower than on a long-term loan. The table below shows the total interest you paid in each situation.

	Short-Term Loan	Personal Loan
Borrowed sum	1000 €	1000 €
Effective interest rate	13.5%	6%
Loan term	60 days	1 year
Total interest paid	15.72 €	32.8 €

The cost of a short-term loan increases drastically if you need the money within 24 hours. This is because you must pay a fee to process your loan request quickly. 

The fee is usually very high and can increase the loan cost from 17 € to 200 €. Only Vexcash offers fast loan services. They share the fee details when you apply online. The fee depends on your loan amount and the loan term.

What happens if you are unable to repay the loan?

• The lender will remind you to repay the loan within seven days.
• If you still haven’t paid the borrowed sum, you’ll get two more reminders.
• The lender will also send a reminder by post. You bear the post costs.
• If you still haven’t paid the credit, the lender will begin the loan collection procedure. You’ll bear the loan collection costs.
• The lender will also inform Schufa, the credit rating agency, about your arrears. This will affect your credit score and decrease your chances of getting a loan in the future.

Alternatives for the short-term loan in Germany

• Overdraft: Most German banks offer an overdraft facility to their checking account customers. In the overdraft facility, you can spend more money than you have in your account. So, if your bank offers an overdraft facility, it could be one of the ways to borrow money in the short term. We find C24* the best bank to offer free checking accounts in Germany as of 2025. You can read the full review of C24 Bank here.
• Credit card with installment option: Many credit cards offer the option to pay in installments. These cards are also called revolving credit cards. They charge high interest rates of around 18%, so you should avoid this option whenever possible.
• Installment purchase: Many retailers in Germany offer the option of payment in installments. Sometimes, they don’t charge interest, and sometimes, they do. In general, installment options from retailers are better than short-term loans.
• Friends and Family: You can also ask your friends or family for money in an emergency. You can agree on the loan terms and even draft a loan agreement. You don’t need the contract to be notarized. As long as both parties sign the contract, it’s binding. You can download the free loan contract template here.
• Employer: Some employers offer cheap loans to their employees. You can ask your manager or HR about this. The installment is usually deducted automatically from your salary.
• Landlord: You can also request your landlord for a deferral of rent payment.

How do the alternative loan options compare with a short-term loan?

It’s difficult to compare the alternative loans because each one works differently and comes with its own terms. The best choice depends on your financial needs and situation.

Here is an overview to help you compare them.

Parameter	Short-term loan	Overdraft	Revolving credit line (Rahmenkredit)	Credit card (with installment option)	Installment loan
How it works	Small loan for a short term.	Bank lets your account go negative.	Flexible credit limit you can draw from. You must apply for it in advance.	Credit card that allows you to pay for purchases in installments	Larger loan with fixed term and monthly payments.
Interest cost	Usually high rates, but the total interest is often lower than other short-term options.	Interest applies only to the days your account is negative	Interest applies only when you actually use the credit; usually lower than overdraft.	Relatively high interest	Low annual interest spread over a long term.
Speed / availability	1–3 days unless you pay for express payout.	Immediate.	Requires initial approval/setup.	Immediate use once the card is active.	Takes several days for approval and payout.
Repayment	One full payment at the end of the loan term.	Automatically repaid when money enters the account.	Monthly installments.	Monthly minimum payments; balance rolls over.	Fixed monthly payments over 12–84 months.
Best for	Very short-term cash needs.	Covering expenses until next salary.	Flexible use with lower interest.	Splitting medium expenses into payments.	Large planned purchases.

NOTE: You should be very careful when taking a loan. Never take more loan than you can afford. A rule of thumb is your monthly installment should be lower than your average disposable income.

Does taking a Payday loan make sense?

Taking any kind of loan makes sense when

• You are planning to invest the amount in an asset that grows in value over time or
• In emergencies.

In any case, you should be able to repay the loan on time. If you pay back the short-term loan late or not at all, further costs will arise from reminders or perhaps even a debt collection process. 

No loan will solve the problem if you repeatedly need payday loans to get through the month. In this case, you need to be disciplined and create a budget.

Can you deduct short-term loan interest from taxes?

No, you cannot deduct the short-term loan interest from taxes, as you took it for personal reasons.

Expenses you can deduct to save taxes in Germany ->

FAQ

References

• https://www.finanztip.de/kredit/kurzzeitkredit/
• https://www.vexcash.com/blog/kurzzeitkredit/
• https://www.duratio.de/kurzzeitkredit
• https://www.bafin.de/EN/Verbraucher/KrediteImmobilien/Kredite/Minikredite/Minikredite_node_en.html?