The firm is offering unsecured personal loans of between £1,000 to £5,000 with fixed repayments over 12 to 24 months at an APR of 35.9% and monthly repayments from £57.

Paul Noble, chief operations officer, 118 118 Money, said: “We are able to extend the availability of unsecured personal loans to people who may otherwise struggle to find a trusted and responsible lender.

“In addition to verifying each applicant’s identity and accessing thousands of data points, we then have a team of underwriters who talk to applicants and bring back the human approach to making lending decisions.

“That means people who might normally have been rejected through automated systems may not be by us. It also means we can consider offering a second chance rate at 79.9% APR if this matches their circumstances. After a loan is made, we understand that things can change, so we offer a late fee refund to help people through if things get tough for them.”

Commenting on the launch, Kevin Mountford, head of banking at moneysupermarket.com, said:

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“There is a massive gulf in the credit space with people with perfect records at one end of the spectrum and payday loans at the other. It is good to see an option for people in the middle ground. It does fill a need.”

However, he urged consumers to shop around.

“You may think you won’t get a loan from a traditional bank because of your credit history but you could be surprised,” he said.