Payday loans can
be harnessed by consumers as potent financial tools that can help them get out
of their financial bind. And since we are now witnessing an increase in the
number of companies that provide this special form of subprime lending service,
more and more consumers are now seriously considering this financial option
when faced with a wide range of financial problems and emergency situations.
So, how do we
define instant payday loans?
Let us first
establish the key features of this type of short term loan in order to properly
appreciate its significance to consumers. This type of loan is also referred to
as paycheck advance, cash advance or payday advance. Payday loans are short
term loans that normally run for up 30 days. When the loan matures, the
borrower is required to settle the loan plus a specified amount of interest.
Payday loans are different from the paycheck advances that are normally
provided by the employer. It is also different from the cash advance that you
are normally entitled to as a credit card holder.
The payday
advance that is provided by your employer is company-based and is governed by
relevant policies of your company. Based on existing company policies, as an
employee, you are entitled to receive a specified amount as paycheck advance.
Depending on the existing policies of your company, you can receive a partial
amount or the equivalent amount of your full salary as payday advance.
Companies normally set a limit to the number of times that their employees can
avail of this cash advance option. The employer normally does not charge for
such cash advances and the same are normally debited to subsequent pay slips
either in lump sum or on a staggered basis.
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