PAYDAY ALTERNATIVE LOANS

A Payday Alternative Loan (PAL) is a small-dollar, short-term loan offered that is a safer and more affordable substitute for high-cost payday loans. The idea is to help members access emergency funds without the excessive fees and extremely high interest rates that traditional payday lenders charge.

  • Lower Costs: PALs have capped interest rates (up to about 28% APR) and usually a small application fee (up to about $20) — significantly less expensive than typical payday loans.
  • Small Loan Amounts: They typically range from about $200 up to $1,000 or $2,000 depending on the type of PAL the credit union offers.
  • Manageable Payments: Instead of being due in a couple of weeks like a payday loan, PALs have longer repayment terms (often 1–6 months, and up to 12 months for some PAL II types).
  • Limited Overlap: Borrowers can usually have only one PAL at a time, and no more than three within a rolling six-month period.

For more information, visit one of POE Federal Credit Union’s branches or contact a loan specialist to get started on your payday alternative loan today.