Payday loans are small micro loans that enable the borrower to get access to funding to meet short term commitments. The loan is usually repaid on payday hence the term payday loan. The main objective is to finance emergency expenses that suddenly occur. Ideally a borrower shouldn’t us a payday loan to fund day to day expenses.
Features of Payday Loans
- Short term usually less than 30 days
- Payment occurs when the borrower gets paid
- Higher interest rates
Advantages of Payday Loans
- Flexibility – the borrower selects the amount and term that fits his situation. The borrower can also use the proceeds of the payday load as he or she wants.
- Fast application process – usually apply online
- Quick payout usually same day.
Disadvantages of Payday Loans
- High interest rates making payday loans a very expensive option
- Can cause over borrowers to become overburdened with debt especially amongst less financially literate borrowers.
How to qualify for a Payday Loan?
- Be over 18 and permanently employed.
- Credit clear and meet the lender’s affordability conditions
Find out if you qualify for a payday loan here and one of our partners will get in touch with an offer.