Why Don’t Banks Offer Same Day Cash Advance Loans?
The lending products that banks offer can be varied but none of them will offer same day cash advance loans or payday products. This doesn’t mean that payday loans are bad and it doesn’t mean that banks are being difficult. This really is just a question of different strokes for different folks.
Same day cash advance loans are designed to give you, as a consumer, instant access to small loans (i.e. from £80-75). These loans are not meant to last for long periods. The name ‘payday’ means that these loans are meant to be repaid next time you get paid. So, you’ll borrow money here for an average of just a few days or a few weeks and then you’ll be debt free once again.
Although same day cash advances are given an APR for comparison purposes this percentage figure is not the true measure of their cost if you will pay them back to schedule. These kinds of payday loans are not given for a year at a time but for a short term period so you’ll be given an easy to understand flat fee to pay here rather than an interest rate. Come your next payday, you pay back what you borrowed plus the fee and you’re all square again.
So, why don’t banks offer payday loans? The general consensus is that these kinds of loans are simply not profitable enough for banks to deal with. Most bank loans will run for at least a year and will involve far greater sums than the average payday loan. The overall APRs may be cheaper but they’ll last longer and you may well pay back more in interest over the term of the loan. This makes these kinds of loans a better bet for banks.
Payday loans are also offered on an income assessment basis without the general need for a credit check. Banks don’t like this kind of financing as they prefer to assess risks in other ways such as running credit checks or using collateral such as your home.
It could be argued that an overdraft facility is kind of like a same day cash advance. Here, you can exceed the balance of the money that you have in your account and the bank will cover you for it if the overdraft is authorised. But, this will in itself, potentially incur various fees and costs if you get your budgeting wrong which could far exceed the simple flat fee that you are charged for a payday loan.
So, if you want a small and quick cash advance loan where you know how much you will owe and that it will be repaid in full quickly then talk to shortloans.co.uk. We may well be able to put cash in your bank account TODAY to help tide you over until your next payday.