Polar Credit – a safety net when you need it

AD | I’m always against taking using credit cards or loans if you don’t need to. The thing about credit is you ALWAYS have to…


AD | I’m always against taking using credit cards or loans if you don’t need to. The thing about credit is you ALWAYS have to pay it back, but with interest. But there are some times when you might need to use credit. Not everyone has the luxury of having an emergency fund or has a family that can lend them money when they need it. But that’s where credit line companies such as Polar Credit come in.

image of calculator for polar credit post

What’s Polar Credit?

Polar Credit is a credit line that allows you to access an amount of credit, but only use what you need. Unlike a loan, where you would take out a full amount. You can have access to money but only use it (and pay interest on what you use only) if and when you need to.

It’s a bit like a credit card without the card. So if you are looking for credit card alternatives, then this is perfect for you!

Customers apply for a credit limit and then uses open banking to access if they can afford the credit you are asking for. Once your credit limit is approved, then you can access the money. You don’t have to transfer all the money to your bank account, just the amount you need (from £25). You only pay interest on the amount you have transferred. So if you have a credit limit of £1000, but only need £50, you transfer the £50 and pay the interest only on that amount. You can then pay a minimum repayment each month, or the full amount.

Polar Credit also rewards loyal customers with a reduction in interest rates. After using Polar Credit for a year, they will reduce the interest rate by 10% per annum. They reduce the interest rate by a further 5% per annum every 6 months until it is lowered to 29.9% per annum.
Polar Credit features include:
• Access to funds when you need it
• Faster to open than A credit card account
• Lower interest rate than payday loans
• More flexible repayment options than short term loans
• No guarantor is needed
• Flexibility to borrow only the money you need, when you need it
• Interest only accrues on the amount that is borrowed, not the full credit limit
• Loyalty is rewarded with lower interest rates
• Can help you rebuild your credit score if used appropriately
• Helpful for short term money shortfalls
• Polar Credit is a revolving credit product, not a loan

When should you use credit?

If you’re unsure whether you should use a credit line company such as Polar Credit, read the following.

To rebuild your credit score

If you have a bad credit score that needs rebuilding, you can do this by borrowing money and then paying it back in full. This is because paying your credit off in full shows that you are living within your means and are not using credit to extend your income, but a way to spend the income you already have.

For emergency situations

If you don’t have an emergency fund (if you don’t, you should consider saving one!), and you incur an unexpected expense, then you may need to use credit to pay for it. Things such as:

  • boiler has broken
  • car has failed it’s MOT
  • an unexpected vet bill

When you can pay the amount back

If you are able to pay the amount back on your next payday, then go ahead and use the credit for one of the two situations above.

When should you avoid using credit

When you already have debt

If you already have a large amount of debt, then consider getting help from a debt management company or from Citizens Advice. Taking out more credit just makes your debt and interest repayments larger, and then you will need to continue to borrow money to keep up with the extra charges and potential late payment charges.

To gamble

The temptation to gamble can be too hard to resist with some people. If you are borrowing money to gamble, then you need to stop and consider if you have a gambling addiction. Gambling money will most likely cause you to lose it, then have to pay it all back with interest on top.

To buy things you don’t need

Holidays, new shoes, a fancy meal out – these are all things you do not need. Don’t borrow money for something you don’t need to buy. Yes, you might think you deserve it, you might live by the ‘treat yo self’ motto, but remember, you have the pay the money back!

You are in a debt cycle

If you find yourself having to borrow money every month, then use your paycheck to pay the debt off, only to be left with no money left and needing to borrow, then you need to seek advice for your financial problems.

You can read how to get debt advice for free here.

My top money-saving tips

I’ve been spending a lot of time figuring out my own financial situation lately and working on my own journey to financial freedom. Here are a few tips I’ve been doing lately that may help you avoid having to use a service such as Polar Credit.

Start an emergency fund

If you don’t have emergency fun, then you need to start one. Aim for £1000 to start with and build on it from there. Ideally, your emergency fund should be able to pay for your living expenses for 3-6 months if something happened to your income.

Have sinking funds

I’ve recently started using sinking funds! A sinking fund is a bit like an emergency fund, but it’s for a known expense, such as Christmas. I organise my sinking funds in my Monzo app. You can have money pots to keep money separate for certain things.

Here are some of the money pots I have:

  • Christmas
  • Birthdays
  • MOT + Service
  • Car insurance
  • Chiropractor
  • Wedding
  • New Laptop

At the end of each money, I put any leftover money into my pots. This gives me a realistic view of how much money I have free to spend on what I want and avoids any need to use credit when I have a large expense coming up.

Review my direct debits

Every month, I review my direct debits and see if there’s anything I can cut back on. It’s so easy to subscribe to things you don’t need or use. Things like Netflix, Spotify, Apple Music, YouTube Premium, Audible – ask yourself if you really need them? You could cancel them and put the money into your emergency or sinking fund instead!

It’s all about balance, I have Netflix because we use it, but I cancelled Spotify as I no longer spend hours in the car for work so don’t need it! Just be honest with yourself and cancel the things you don’t need or use.

Know your figures

It’s so important to know your financial situation. Don’t bury your head in the sand! Know how much is going into your account each month, the price of your bills, your rent/mortgage. If you have a mortgage, know how much you have left to pay. This will put you in a better position to make the right choices when it comes to spending money.

Overpay your mortgage

Overpaying your mortgage is a great way to lower your overall interest paid on your mortgage, as well as paying it off sooner. I did a quick calculation on a mortgage calculator and found out I could save around £35,000 in interest and pay off my mortgage 9 years earlier if I overpaid by £250 a month. Even putting £50 a month in your mortgage will start chipping away at your interest!

Don’t forget to check how much you are allowed to overpay before doing this, as most companies have a limit per year (mine is 10% of my total amount per year).

Premium Bonds

I’ve recently put my emergency fund into premium bonds, as the interest on savings is really poor right now, so my money was just sat in the bank using value. With premium bonds, you can save up to £50000 and then every month you get entered into a prize draw where you can win up to £1 million pounds, such loads of smaller prizes. In my first month, I won £25.

You can withdraw money from your premium bonds at any time, it will take about 3 days to get the money back in your account so if you do need to use it, then you can access it!

Look at extra ways to make money.

I’ve been making bits of money here and there on surveys, cashback sites, receipt apps and refer a friend program. Read this post for some ways I’ve been making money on maternity in my money section and check out my money blog for some tips on how to save and make some extra cash in your spare time!


  1. It’s so refreshing to read such a balanced review about credit. Credit can feel like such a dirty word, but I think in some cases it’s a necessity, and sometimes can be a great thing. Thank you for sharing your tips at the end of the post too. I could definitely do with building up my emergency fund. My car’s just failed it’s MOT (waaaaah) so a big chunk of that’s gone now. Eeek!


    1. There really is a right and wrong way to use credit! I’m really against using credit for things I can do without and against using it to pay off other debt that you can’t afford to pay but then continue to stay in debt (apart from debt consolidation loans which can be helpful to those in financial trouble)!

  2. I’ve not actually heard of Polar Credit but sometimes you need a safety net to ease your mind during financial difficultly! Thanks for sharing x

  3. I never heard of Polar Credit, but this a very interesting view on credit! It’s better to know that you can access just what you need instead of having a large sum open to spend! Are premium bonds something you do through your bank? x

  4. This is a great post Corinne, with some great tips. Polar Credit are a great option if you need it but definitely not suitable for everyone, so your list of reasons why you shouldn’t use it is really helpful

  5. Hi Corrine, what a great and insightful guide! I haven’t borrowed money before but this is a great idea to keep in mind! Thanks for sharing! Alicia

  6. This is such a handy post. Really great information on here. I had never heard of Polar Credit before but they sound great, especially for those looking to work on their credit score. I love that you mentioned the sinking funds. This is something that I have been doing for a few years now and it honestly changed my life, something I really recommend everyone tries to do.

  7. I agree that having a backup is great, but a service like this works only for small amounts. For expensive things is better to get a loan as the interest rate is smaller. Also, I think is better to having a savings account instead of paying off the mortgage earlier, unless you can do both, of course.
    Although I did not know about Polar Credit and it’s good to know as unexpected things can happen anytime.

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