7 Interesting facts about payday loans that you must know!

understanding payday loans

The payday loans are considered as the easiest and the most convenient ways to raise loans in case of exigencies. There are a number of people who visit the loan companies and take the payday cash loans but are really not aware of what actually these loans are.

Are you also inquisitive to know what exactly is the payday loan all about? Well, to put a definite end to all your queries, we acquaint you with some interesting facts about the same day loans which you must know, to make your borrowing a wise and intelligent decision. Read through:

  • Young industry: The payday loan industry is not a very old industry and emerged just 20 years back in the era of 90’s. However, the other loans which are prevailing in the Banking industry are ruling for nearly 70 years. Thus, being new to the industry, the payday cash loans are not so popular and this is the reason the borrowers are not fully aware of these loans, the terms and conditions, benefits and eligibility. There are instances where the borrowers are totally unaware of the presence of such a product which can cater to their emergency needs.
  • Coverage: There is no denying the fact that the emergency cash loans have spent just two decades in the finance industry, but in this short span the loan has captured a huge market. As per statistics, nearly 30% of the population makes use of the payday loans at least once in a while, mostly in the event of occurrence of an emergency and as much as 70% of the population is known for taking these kinds of loans on a monthly basis to meet the expenses.
  • Global product: The coverage of the short term payday loans is not just limited to one single country, however, it’s charm and aura is spread across the length and breadth of the globe. From the United States to Japan, as many as half of the countries of the globe are dealing with the payday cash loans. The only thing is that different countries have given different names to this loan facility. The global presence of these loan makes them a popular source of avenues.
  • Target audience: Each and every loan product is designed with a target audience in mind and the emergency cash loans are no different. These loans are targeted to the middle-income group of the community who always have a definite means of earning and spending. This class of people gets into some urgent expenses once or twice a month for which they need to take a loan. Also, this class of population repay well in time to keep off the burden of the loan. This target audience is considered as the safest to work with.
  • Quick procedure: Loans are always associated with long waiting time and cumbersome procedure, but the quick pay day loans have totally broken this very image. The procedure for availing the payday loan is very simple, all you need to submit is one identity proof and one income proof along with your passport size photograph. There is no unnecessary forms or application for getting this loan. Also, the loan is processed very quickly. The minute you submit your application, you can check the amount in your account in the next 15 minutes. The easy procedure and quick remittance of funds make this loan a must product in case of any kind of exigency.
  • Short repayment period: Since the emergency cash loans are usually taken for the emergency purpose and are granted for repayment on the same day or the next day, the liability of the loan remains with the borrower just for a day or two. This saves the borrower from the unnecessary burden of the loan. The borrower is required to repay the loan amount either on the same day or the next day and finish off the liability.
  • No instalments: Unlike the other regular loan products, the small payday loans do not come with a fixed monthly instalment chart. The borrower is required to repay the full amount taken from the financial institution along with the interest applied to the loan amount all at once. Once you repay the amount, you become eligible to take a fresh amount as loan. Usually, 40-60% interest rate is charged on the amount taken as loan for a day.