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Sometimes you just need a little cash injection. We have all been there, you see a great bargain which you know needs snapping up but you don’t get paid until after the weekend.

You don’t really want to use your credit card because you are only just inside your comfort zone there – besides you may be paying a hefty rate on that anyway. You haven’t got time to go to your bank and extend your authorised overdraft limit. The thought of a ₤20 per day charge for an unauthorised overdraft is just beyond the pale.

What you really need is a short-term bridging loan that will provide the funds almost immediately and will allow you to pay it back in a matter of days with you controlling the level of interest you pay.

Online bridging loans for small amounts are really starting to catch on and so long as you use them responsibly they are a viable option if you really need cash urgently for say a purchase on e-Bay or a holiday offer on Lastminute.com.

Companies like Pay Day, Financial, Same Day Money and Wonga.com, offer short term loans online that can put money in your account within an hour of being approved under a credit check.

On first sight the APR rates on these products are liable to set your hair on end – 1286% for both Pay Day Financial and Same Day Money and 2689% for Wonga.com but an annual rate is not really relevant to a product where the maximum repayment period is one month – the companies have to by law provide an APR rate – even though it is redundant for comparison purposes.

If used sensibly these products can offer cash quickly and conveniently and can be paid back quickly with little fuss.

For instance Wonga.com offers a maximum credit of ₤200 and can sort it out in a matter of minutes online. The interest charge is 1% per day and the maximum loan period is 1 month. So if you borrow ₤100 from Wonga the total repayment after five days (including fees) will be ₤110.70.

Unlike credit cards the amount has to be paid off after 1 month so in theory huge debts shouldn't occur (unless you default) and unlike pawnbrokers nothing has to be put down as security.

Like any of these credit facilities they are only as good as the responsible people that use them.

But the company claims that for anyone that wants immediate cash short-term, instant loans are the way forward. Errol Damelin, founder and CEO of Wonga.com, said: “We provide a fast, flexible and short-term alternative for occasional cash flow problems. Our technology allows us to offer a convenient solution around the clock, but we also use it to ensure we lend responsibly. We decline a large percentage of applicants based on our automated decision system, but those who are accepted tell us they prefer using Wonga over traditional sources of credit because they feel in control.”

Case Study:

James Brown, is 39, lives in Airdrie and works in the customer service industry. He has used Wonga to bag flight bargains amongst other things (where he’s saved more than the cash advance has cost).

"From my perspective Wonga has saved me money and probably will in the future."

"For several months I reduced my working hours to accommodate a degree course and that meant a reduction in income. The most important thing was to ensure that all direct debits and commitments were paid on time, which they were thanks to Wonga. If they had not been I would have had all manner of bank charges which, as some people have unfortunately found, can easily run into hundreds of pounds. Using Wonga also, I believe, helped preserve my credit rating."

"But the biggest win for me was booking a flight to the States. I found a great deal with an airline but did not have the cash and if I didn’t get it quickly I wouldn’t get the discount. Rather than putting it on a credit card, which takes real discipline to repay every month, I took out a short-term loan with Wonga and saved myself about £280."

The Financial Adviser's View

Alan Smith, IFA with London-based Capital Asset Management, accepts that people at times will want access to short-term capital but he insists they tread carefully.

"Easy access to credit is one of the reasons for the recent financial meltdown, so I would be cautious about such an initiative. However if the scheme is well run and applies prudent lending principles then the speed and efficiency of the service could work for some people. As always I would recommend reading the ‘small print’ and be aware that borrowing over much more than a period of a week can become very expensive."