Financial emergencies do not knock on the door before getting inside your life. It may land in anyone’s life, especially when it’s near the end of a month. Nonetheless, there are multiple financial solutions available for certain situations, but most of them require extensive paperwork and satisfactory credit credentials. This often results in a tedious verification procedure, making them unideal for fast fund requirements.
Therefore, such situations have led to the increasing popularity of instant, short-term borrowing options, like, payday loans online. Their easy availability might persuade you to opt for these financial products without considering them for the second time. Still, it is essential to perceive what these comprise of if such loans are really handy.
Features of Payday loan Online
A payday loan online is assessed as a short-term, small funding option extended to working-class individuals. Generally, it comes with a short repayment tenure. Some prominent features that make these loans a well-liked funding option are as follows:
-
Fast Approval and Disbursal
Typically, these loans are promptly approved and disbursed, sometimes within the same day.
-
Collateral-Free
These loans are unsecured in nature, which means that the borrowers do not got to pledge any asset to avail one.
-
Multifaceted Nature
Financial institutions do not exercise any sort of control on the end-use of such instant loans online, putting borrowers at the freedom of using these funds to finance their low-budget requirements.
-
Independent Loans
Taking out payday loans does not need any guarantor. Thus, applicants are saved the effort of convincing another person to vouch for his or her credibility.
Prior to availing of these benefits of an emergency payday loan, willing individuals must even be conscious of what availing one entails.
Eligibility Criteria for Payday loan Online
Nevertheless, most payday loan apps do not mandate strict eligibility criterion such as credit history check, there are a couple of standard requirements that applicants got to meet, such as:
- Applicant must be at least 18 years aged.
- S/he must be a full-time salaried individual.
- Individual’s monthly income must gratify the standards of the moneylender.
- The borrower must possess an active bank account.
- Applicant must be a citizen of India.
Documents Required for Payday loan Online
Besides meeting the eligibility requirements of payday loans, there are certain fundamental documents that are required so as to avail of the payday loans. Below we have listed some of the basic documents that are required for a borrower to submit against a payday loan online:
- Proof of identity
- Proof of residence
- Proof of income
- Letter from the present employer
- Recent passport-sized photographs
- Proof of age
The requirements of eligibility and documentation of a payday loan might come up as the best compared to all or any other sorts of credit. But a few more advantages and disadvantages features are there that you must know before you avail of this product, let’s have a look.
Advantages of Payday loans Online
Payday loans stand out to be a saviour for those that live on a monthly basis and find it difficult to confront sudden expenses. Let’s take a look at the major advantages that you relish via payday loans:
-
Fast and Simple
It is an instant loan as it is often approved and disbursed within a matter of minutes, thereby, no hassle of lengthy waits.
-
Nominal Documentation and Formalities
In the majority of the events, the requirement is to possess an active bank account and share some personal and financial information. It does not require any extensive documentation as needed in other loans.
-
No Credit Check
As these loans are availed by the working people, no credit checks or collaterals are engaged. Anyone can avail of this loan product regardless of their financial background.
Disadvantages of Payday loan Online
Payday loans perform as advance salary in India, and that they make it easier to meet the emergency expenditures. But you should also consider that their easy availability may blind you to their more precarious facets. Let’s take a look at some of them:
They come with extremely short repayment tenures that range maximum up to 4 weeks, as a consequence, it results in increasing default rates.
Payday loans put lenders at greater risk, leading them to charge strikingly high payday loan interest rates up to 20%/day.
However, the daily rate will not seem too intimidating, the Annual Percentage Rate (APR) can range from 36% to 730%, depending upon the time taken to pay off the entire debt. Leading to the high cost are complementary charges such as processing fees.
Heading on to avail of a payday loan without prior knowledge of those features might lead you in extreme danger.
Consider These Before Availing of a Payday loan Online
Consider availing the assistance from the moneylenders that grants instant loan across the entire year. Following are some of the things that you must consider checking if you are going to choose a certain offer and apply for a payday loan online:
- Instant turnaround and approval online
- No hidden fees or costs
- Low rates of interest and annual percentage rates
- Flexible funding and repayment tenors
- Funds disbursal within an hour
- Strict data protection
Alternatives of Payday Loan Online
Besides, there are certain alternatives that you can consider just in case you are seeking options of payday loan online. The following stand out to good options against payday loans:
- Reduce expenditures
- Borrow from family and friends
- Apply for an instant personal loan
- Use a credit card and pay it back once you get your next salary
- Borrow from employer
- Maintain a private line of credit ready for emergencies
The Last Blow
To sum up, payday loans stand out to be great when you need instant fund assistance. Although you should be very careful prior to determining a certain offer as if you fail to pay it off within the set tenure, you might end up with a hectic debt trap. So, consider checking on repayment capability before you choose to apply for a particular payday loan amount.
Additionally, you can get great deals on instant personal loans from Afinoz to confront your emergency needs. You can get the best personal loan interest rate along with several other appealing features including a quicker application process, flexible repayment options. To apply, download our instant loan app now from the Google Play Store!