People often confuse payday loans with cash advances because the core purpose of both is the same i.e. providing the people with fast and easy access to loan money. People took them both as the same entity. But are they really the same?
Well, that’s quite an extensive discussion, because after all they both apparently seem the same loan services. But let me tell you, there is in fact a differentiating line present in them.
And today we’re gonna discuss it in detail. We’re gonna reveal to you the slightest differences that each of them holds and which makes each of them an individual loan service. So let’s begin:
Introduction to Cash Advance
Cash advance often known as an instant cash advance or merchant cash advance is the short and instant loans mostly taken by businesses ( however, everyone has to access to them) by using their credit card. But the difference between a regular credit card loan and a cash advance loan is that it doesn’t take your credit history into account even if you hold a bad credit score. You can get cash advance loan instantly from https://slickcashloan.com/cash-advance-online-same-day.php
Introduction to Payday Loans
Just like cash advance loans, payday loans are also short and fast cash loans lent by banks. Unlike cash advance loans, you have to fill some forms and applications instead of using your credit cat to apply for payday loans. Payday loans do not require a good credit score either, and you can get your money within 48 hours or sooner.
When it comes to how much cash you can borrow through either of the loan services, as for payday loans you can ask anywhere between $100 to $1000 in cash. In the matter of cash advance, the borrowing amount depends upon the ratio of your credit limit.
The repayment terms of both services also differ at some point. Both services start to receive interest immediately. You have to pay back the debt of a payday loan in a fixed timeframe depending upon the terms of companies, however, in cash advance, you can carry the debt for a long time.
We must say that the biggest difference between both services is of the interest rate they charge. Payday loans charge 400% APR and sometimes even more, while the APR rate of Cash advance is 24%.
As for the fees, the cash advance $10 to $20 or sometimes 3% to 5% (whichever is greater) per transaction. The payday has fixed fee schedules, $15 to $30 per $100.
Requirements for both
As both the services conduct different methods of registration, therefore the requirements for both also differ. For a cash advance loan, you must have a credit card that offers cash advances as well. And for the payday loan, you just need a simple bank account
Which One is better to go for?
According to melanom.net, Giving the superior tag to one of them is quite difficult, as both of them carry their individual qualities. When it comes to decide which is one better than the other, we have deduced that it depends upon the situation and availabilities. You can go for either of them depending upon the situation you are going through.