No, you cannot typically pay off a payday loan with a credit card and lenders do not accept this as a form of payment.
It is understandable that if you are unable to make an upcoming payment that you might use a credit card or revolving credit to pay it off – and this could buy you some more time and breathing space.
But in practice, using a credit card to pay off a payday loan is like using one form of credit to pay off another and is really just adding to an ongoing cycle of debt.
Key Points
- No, you cannot use a credit to pay off a payday loan because this is like using debt to pay off more debt and can lead to financial issues
- Consider using a credit union, speaking to the lender or a finance professional if you need help with paying off a loan
- It is possible to use a balance transfer credit card to pay off a payday loan, if the lender allows it and charges do apply
Why Can’t You Use a Credit Card To Pay Off a Payday Loan?
Payday lenders do not accept credit cards as a form of payment because it is like using one form of credit to pay off another and can lead to ongoing debt problems.
The traditional methods of repayment for payday loans are using a debit or current account and using ACH authorization to collect monthly payments automatically. This means that you authorize your debit card where you get paid from work with the lender, and then on the scheduled repayment date (such as the 30th of the month) the funds are automatically collected.
Can I Use a Balance Transfer Credit Card To Pay Off My Payday Loan?
Yes, you can use a balance transfer to pay off a payday loan, if the lender will accept it, because some may not.
But this would involve taking a chunk or the entire payday loan balance and putting it on a balance transfer card, which may offer 0% interest for a period such as 12 or 24 months.
So you will still be paying off the outstanding balance of the loan, but with no added interest for a certain period and presumably the repayments are spread over longer than just the 3 month payday loan for instance.
In addition, the rates and fees for late repayment with a credit card balance transfer may be less than a payday lender.
However, this is not a common means of paying off a payday loan and you should not be relying on this as a repayment method if you are under financial pressure.
Are There Any Loans That Allow You To Pay Off Using a Credit Card?
Yes, whilst it may depend on the lender, there are various loans that allow for payment using a credit card including:
- Mortgages
- Business loans
- Car loans
What Are The Other Ways To Pay Off a Payday Loan Other Than ACH Authorization?
If you are struggling to repay your payday loan, there are some sensible measures to approach including:
Speaking to the lender – By contacting your lender and explaining that you have some financial difficulty, they are often trained to help, offering payment plans and being able to freeze interest and added charges or penalties. By not answering the lender if they send you missed repayment emails and phone calls, they will naturally add interest and charges, and defaulting will negatively impact your credit score.
Speaking to a debt professional – There are several free debt professionals and charities that you can speak to free of charge who can give you some terrific options to manage your debts better and help repay your loan off in the most affordable way. This includes the NFCC and Green Path.
Trying a credit union – Around 33% of Americans belong to credit unions which offer loans and credit at much more affordable rates. Exploring this option would be sensible if you have any emergencies or bills to pay – and can help you avoid payday loans in the first place.
Other Options That Are Not Always Recommended
Having a relative pay off your debts
It is possible for a parent, spouse or sibling to pay off your loan for you (see can you pay off a loan for someone else). In doing so, you can be up to date with payments, no longer in arrears and your credit score can be intact. You will of course still owe money to your relative, but without the additional fees and charges. You must have their permission before paying off your loan.
Drawing money from a credit card
Most credit cards allow you to draw money from an ATM and this is perfectly legal. However, it does come with fees and charges, including withdrawal charges and just taking out money from a credit card alone will incur a negative mark to your credit score.
Buying a money order
Some people purchase a money order using a credit card and use that money order to pay the payday lender. Most credit card issuers will treat purchasing a money order as a cash advance. This triggers the same high fees and interest rates as taking cash straight from an ATM
Last Updated on June 18, 2026 by Daniel Tannenbaum, Founder of Pheabs