On 6 April 2026, the government scrapped the two-child benefit cap – a rule which stopped many families on lower incomes from getting benefits for their third child, or any children after that.
We know this is likely to impact lots of families who are Fair for You customers. It might impact you if you have three children, whether or not you already get Universal Credit.
So if you have three or more children in your family, read on…
What was the two-child benefit cap (or ‘two-child limit’)?
You might hear the term ‘two-child limit’ as well as ‘two-child benefit cap’ – they both mean the same thing.
Since 2017, families claiming Universal Credit could only receive the Child Element – a monthly payment for each child – for their first two children. Currently, the Child Element is at least £303.94. It can be more in some cases, for example if a child has a disability.
But a third child, fourth child, or more? Apart from in some exceptional cases, the cap meant families got no extra support. This rule only applied to children born after April 2017.
It’s important to remember that the two-child benefit cap is different to the Benefit Cap, which is the overall limit on the total benefits a household can get.
What has changed?
From 6 April 2026, the two-child limit no longer applies. Families can now receive the Child Element of Universal Credit for every child in their household, not just the first two.
This means families with three or more children may be eligible for hundreds of pounds in additional payments each month – that’s several thousands each year.
Who benefits from this change?
This is relevant if you have three or more children and you receive Universal Credit. Government statistics last year said that 470,000 families in the UK were in this position.
It will also be relevant to other families who don’t currently receive Universal Credit – now the two-child limit has been removed it means that the overall Benefits Cap is increased, so more families will qualify. Even if you or your partner are working, it’s worth checking whether you could get it.
It might even be that you were eligible all along - research shows that more than £24bn in benefits goes unclaimed each year.
Use the benefits calculator on our website to find what benefits you can get – some people find out about new income.
I already get Universal Credit, do I need to do anything?
If you already get Universal Credit, and the Department for Work and Pensions (DWP) knows that you have three or more children, your payments should be updated automatically. This means you should get extra income soon – if you don’t, you should contact Universal Credit.
If you have three or more children and hadn’t told the DWP about all of them – because you knew you wouldn’t get extra Universal Credit – you should let them know as soon as possible. If you’re unsure whether you told the DWP about all of your children, it would be a good idea to double check.
You can contact Universal Credit on the helpline or through your online account. If you’re in Northern Ireland, there are different contact details to use.
If you don’t currently get Universal Credit, you can use the benefits calculator on our website to find out if you are now eligible for this or other benefits.
Can Fair for You help?
We know that times are tough financially for lots of families. Even with a bit more Universal Credit, you might still want support spreading the cost of an essential items like fridge-freezers, cookers, washing machines and other appliances, or something for the kids.
Fair for You is an ethical lender. We’re not-for-profit, and we’re owned by the Fair Credit Charity. Our loans are designed for people who find it hard to access mainstream credit – lots of our customers receive Universal Credit or other benefits.
We offer loans which cover the cost of a single household item (including delivery for many items). We also have a Shopping Card loan – this means you can spread the cost of purchases at stores including Argos, Dunelm, Iceland, Currys, Tapi Carpets and more, using a prepaid card with between £50 and £350 of credit.
If you’re worried about money, our Debt & Money Matters page has lots of links to free advice and support.
Will you take into account my benefits income if I apply for a loan?
Yes. When we look at your application, we consider all kinds of income – including benefits. Lots of Fair for You customers receive benefits, and we understand that benefits income can be just as regular and reliable as a wage.
Fair for You loans are subject to eligibility and affordability checks. Missed payments may affect your credit file. Only borrow what you can afford to repay.