A Payday loan is the easiest and the fastest way of obtaining finance for funding expenditure that cannot be met from salary or other available sources of cash. As these are secured against the salary of the borrower, these are promptly sanctioned to a person who is currently employed.
Advantages of payday loans
Easy application process
Among the different forms of secured and unsecured loans, the application process of payday is the easiest. Any person with an employment record can apply for this loan. However, the exact rules and regulations vary from country to country. For instance to be eligible for a this in UK, a person should be at least 18 years of age, a permanent employee in an organization, have a checkable bank account and should earn a monthly salary above £750.
Get instant cash
When a person applying for a loan fulfills all the aforementioned rules, it is sanctioned almost instantly. The online loan application system has further simplified the application procedure. It is available in a few days. Several online loan companies even sanction within 24 hours after the loan application is submitted.
Meet emergency expenditure
Payday are ideal for financing unforeseen exigencies. During emergencies, we cannot afford to wait for days for funding the expenditure. During such circumstances payday are the suitable solution for sudden financial problems.
Suitable for people not eligible for other loans
Often payday is the only source of credit for borrowers not eligible for other types of secured or unsecured loans. It is especially beneficial for individuals who despite being permanently employed in an organization with a good monthly income do not have property or gold that can be mortgaged to obtain a secured loan.
Disadvantages of payday loans
Despite its benefits, just as any other form of loan, these also has its share of woes. However, these disadvantages are largely experienced by borrowers who fail to repay the loan within the scheduled time. Payday loans are usually considered an expensive source of finance. The cost of obtaining a payday is usually higher than that of conventional. However, this is a disadvantage that most borrowers desperately seeking finance to meet emergency expenses are ready to overlook. If you are employed and have a steady source of income, you can easily repay the loan within a short time. Moreover, reputed companies strictly adhere to the government regulations, charging interest in accordance with the government norms.