Easy payday loans, or micro loans
Easy payday cash loans are a niche market that is on the rise. People that need small cash injections instantly are turning to these quick and easy online lenders.
The market for these loans is on the rise, because sometimes banks aren’t as helpful as they used to be, when it comes to small loans. There was once a time that if you were in a bit of a jam you could wander into your local bank, speak to the manager and work something out for your short term problem. Now, if you don’t want to borrow at least $5,000, you can get turned away for not having enough return on investment potential.
And so, these people who are in a temporary cash crisis are turning to the payday micro-loans for help.
One of the other main reasons that these types of loans are going through a boom is that they are so quick. Most places offer same day payments, meaning borrowers can make payments or pay bills without the potential risk of missing payments and incurring default fees.
The potential borrower logs onto the payday loan website, fills out a form and gets sent a contract. Most places have a paperless service, which means that you don’t need to print or fax anything. Once all the online paperwork is done, the money gets direct credited to your account, and then, when the money is due back, it gets direct debited out of the borrower’s account.
The reason I called them a micro loan is because the loan period for most of these companies is a maximum of around 40 days. That means, borrowers that get paid monthly will have to pay it all back on their next pay, those who get paid fortnightly will get two repayment dates, and the borrowers paid weekly can get up to 4 repayments. Being offered more repayments isn’t exactly a good thing, though: the longer the loan, the more interest you will be paying, and so paying it back as soon as possible is the best way to get the most out of a fast easy payday loan.
The thing that gets most people upset about this type of loan is the interest rates that are charged. Interest rates are always stated for yearlong periods and that makes these loans look ridiculous with some companies having rates over 600%. But when you take into account the fact that such loans are only a maximum of just over a month, then the rates start to make sense. If they were to charge rates like a mortgage, then they wouldn’t make money over the processing fee.
These micro payday loans are still trying to cement their place in the financing world; if the current trend continues then they shouldn’t have too much trouble in becoming a standard financial service that is recognised as safe, convenient and affordable, when used responsibly.