The Department for Work and Pensions (DWP) has introduced an opportunity for Universal Credit claimants to access up to £2,600 through the Advance Payment Scheme.
This initiative aims to provide immediate financial relief to those awaiting their first Universal Credit payment or experiencing a change in circumstances.
Understanding the Advance Payment Scheme
When you apply for Universal Credit, there’s typically a five-week waiting period before receiving the first payment. For many, this delay can lead to financial hardship.
The Advance Payment Scheme allows eligible individuals to receive up to 100% of their estimated monthly Universal Credit payment in advance.
This amount is then repaid over a period of up to 24 months through deductions from future Universal Credit payments.
Eligibility Criteria
To qualify for the Advance Payment:
- New Claimants: If you’re awaiting your first Universal Credit payment and are in financial hardship.
- Existing Claimants: If you’ve reported a change in circumstances leading to an increased payment but haven’t received it yet.
Requirements:
- Provide bank or building society details.
- Complete identity verification for yourself and your partner (if applicable).
- Demonstrate financial need.
Application Process
1. Online Application:
- Log into your Universal Credit online account.
- Navigate to the ‘Apply for an Advance’ section.
- Follow the prompts to complete your application.
2. Through Your Work Coach:
- Discuss your financial situation during your Jobcentre Plus appointment.
- Your work coach will guide you through the application process.
3. By Phone:
- Call the Universal Credit helpline at 0800 328 5644.
- Provide necessary information and request an advance.
Decisions are typically made on the same day, and approved funds are usually disbursed within three working days.
Repayment Details
- Repayment Period: Up to 24 months.
- First Deduction: Begins on the day of your first Universal Credit payment.
- Repayment Method: Automatic deductions from your Universal Credit payments.
- If You Stop Receiving Universal Credit: Repayments will be arranged through other means, such as wages or other benefits.
Budgeting Advances
For existing Universal Credit claimants facing unexpected expenses, the Budgeting Advance is another support option.
This advance can help cover costs like emergency household repairs, work-related expenses, or funeral costs.
Eligibility Criteria:
- Must have been receiving Universal Credit, Employment and Support Allowance, Income Support, Jobseeker’s Allowance, or State Pension Credit for six months or more.
- Earned less than £2,600 (£3,600 for couples) in the past six months.
- Paid off any previous Budgeting Advances.
Loan Amounts:
- Single: Up to £348.
- Couple: Up to £464.
- With Children: Up to £812.
Repayment:
- Deductions from Universal Credit payments over 12 months.
Information Summary
| Feature | Advance Payment | Budgeting Advance |
|---|---|---|
| Eligibility | New or existing claimants in financial need | Existing claimants with 6+ months on benefits |
| Maximum Amount | Up to 100% of monthly UC payment | £348 (single), £464 (couple), £812 (with children) |
| Repayment Period | Up to 24 months | Up to 12 months |
| Application Methods | Online, Work Coach, Phone | Online, Work Coach, Phone |
| Decision Timeframe | Same day | Same day |
| Disbursement Timeframe | Within 3 working days | Within 3 working days |
The DWP’s Advance Payment Scheme and Budgeting Advances are vital tools to support individuals facing financial challenges during the Universal Credit application process or unexpected expenses.
By understanding the eligibility criteria and application processes, claimants can access these funds to alleviate immediate financial pressures.
It’s essential to consider the repayment obligations and explore all available support options to ensure long-term financial stability.
FAQs
Can I apply for both an Advance Payment and a Budgeting Advance?
Yes, if you meet the eligibility criteria for both, you can apply separately for each. Ensure you understand the repayment terms for each advance.
What happens if I can’t repay the advance on time?
If you’re struggling with repayments, contact your work coach or the Universal Credit helpline. In exceptional circumstances, repayments can be delayed for up to three months.
Will taking an advance affect my future Universal Credit payments?
Yes, repayments are deducted from your future Universal Credit payments, reducing the amount you receive until the advance is fully repaid.