Concerns have been raised about how easy it is for borrowers to overextend themselves by signing up for multiple loans from different lenders.
But from April, credit reference agency Callcredit will offer daily information about other loans held by an applicant.
At present this information is only updated every month.
Borrowers would still be able to apply for several loans on the same day but people finding themselves in a debt spiral should find it much more difficult to secure multiple loans.
Callcredit said that the move would have "a major positive impact for both lenders and consumers".
The industry has come under pressure from MPs to improve sharing of up-to-date information among payday lenders.
A number have signed up to the latest initiative, which will provide them with information about any missed repayments, rollovers or extensions to loans.
Lender Wonga is among those companies which have signed up.
"Given the importance of an accurate and up-to-date picture of an individual's borrowing history and financial position in deciding whether to extend credit, Wonga hopes that the platform will be adopted beyond the short-term credit sector and across all UK consumer financial services," said Rael Sarembock, head of decision analytics.
Russell Hamblin-Boone, chief executive of the Consumer Finance Association (CFA), which represents short-term lenders, said: "The CFA supports an industry-led solution and there will be some CFA members among the early adopters of Callcredit's model."
[Source: http://www.bbc.co.uk/news/business-25743517 ]
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