Sainsbury's Bank launches cheapest-ever standard personal loan at just 2.8% APR

The 2.8% representative APR is available on loans of between £7,500 and £20,000, provided borrowers are members of free-to-join loyalty card scheme Nectar and choose to repay within one to three years (or two to three years for loans of more than £15,000).

Borrowers who aren't Nectar cardholders, or who choose a repayment period lasting more than three years, face the slightly higher representative APR of 2.9%.

It means that if you borrowed £10,000, repaid in monthly instalments over three years at the Nectar members' rate of 2.8% APR, your total repayment would be £10,432.

The loan is typically the cheapest on the market for someone borrowing between £7,500 and £20,000, with similar loans from rival lenders all coming in at over 3% APR – though the amount you can borrow and the actual rate offered will of course depend on your individual circumstances.

And although borrowing is cheap when done right, don't see that as an invitation to do it. Only use it for planned spending – eg, a new car or kitchen – and for as little as you need. Aim to repay it as quickly as possible, making sure you've budgeted and checked repayments are affordable.

For more on this and other best-buy loans, see our Cheap Loans guide.