Yara Zakharia, Esq.
The Online Cash Advance
With the technological advent of the internet, the cash advance industry has witnessed exponential growth. The electronic medium eliminated the requirement that a borrower fax in copies of check stubs, bank statements and other documents. It enabled cash advance stores to simplify and accelerate the application process. With an increasing number of consumers seeking a faxless payday loan, the online cash advance industry has become the most rapidly-growing segment of the short term loan industry.
Online payday lenders market their product via paid ads, email, referrals and online searches. More and more cash-strapped Americans are resorting to online cash advance for financing homes and auto repairs, settling emergency bills, paying for emergency trips, and the like. In fact, it is projected that online payday advance lenders will capture an even bigger chunk of the market than brick-and-mortar payday providers over the next few years.
The application process for an online payday loan is fast and easy. A customer fills out the application requesting proof of income and personal data either online or by fax. Upon approval, the lender deposits the funds into the borrower's bank account usually within one business day. On the client's next payday, it electronically debits the funds plus a finance charge from the customer's checking account. Borrowers can choose from an array of repayment options, selecting the schedule that best corresponds to their financial situation.
Online payday loans differ from regular payday loans in several respects:
First, many individuals lack access to a fax machine; finding one entails time and money. With an online cash advance, borrowers can avoid the hassle and expense involved in faxing documents. Secondly, an online faxless payday loan offers borrowers the opportunity to obtain their loan on the same day and therefore, is much faster than through a regular payday loan. Thirdly and most importantly, an online personal loan provides maximum confidentiality and privacy.
Most check cash advance businesses allow clients to repay their loan straight from their checking account, by way of a wire transfer. Proof of employment and a checking account are, for a majority of lenders and financial institutions, prerequisites to issuance of a payday loan. The short term loan industry also offers savings account payday loans, which are income-dependent extensions of credit. As compared to more traditional online financing, a savings account cash advance depends on the consumer's bi-weekly net income. This option increases the likelihood that a borrower will repay the quick payday loan with the least amount of finance fees.
Although some lenders authorize savings account crediting and debiting, they are, for the most part, rare. With a savings account payday loan, the consumer is under no duty to borrow, even after submission and payday lender approval of his/her application. Before agreeing to the short term loan, the borrower is informed of the interest rates and fees. Another benefit offered by the savings account payday loan is that, at most cash advance businesses; there is no credit check requirement. All that is needed is proof of employment and a direct deposit savings account.
An online payday loan offers consumers numerous advantages:
- A convenient online application
- No fax requirement
- No credit check requirement
- Optimal privacy, security, and confidentiality with respect to personal data
- Non-disclosure to any third party of personal data concerning the borrower
- Fast processing and notification of approval status
- Overnight transfer of the funds into the borrower's checking or savings account