There may arise times when you have financial emergencies where urgent expenditures can’t wait. Half the people in the country are underprepared for medical emergencies. When you own a small business and need to buy machinery or pay your staff or come across a medical emergency, you need instant cash flow to fulfill your needs. It can be extremely difficult to gather funds on such short notice.
Applying for a personal loan can seem like a viable option, but how soon are personal loans approved? Stats show that 32% of millennials’ credit loans were rejected in 2020. However, with the evolution of the banking sector, seeking financial assistance has become very easy & quick today. Same day loans can be lifesavers in getting you out of any such urgent financial jams.
What are the Same Day Loans?
Same Day loans or Instant cash loans are funding solutions available to people whose need for financing is high within a short span of time. They are short-term loans that are unsecured and largely work like personal loans. As evident from the name, same day loans give you access to funds on the very same day or (practically) within 2-3 business days that you apply for the loan.
Some Features of Same Day loans
Disbursal of the money is either done on the same day or within 2 to 3 business days maximum. This makes this type of loan one of the most sought after options when it comes to urgent money requirements. The maximum amount of money you can avail a loan for will vary based on various schemes. No more going to the banks for hours and hours of paperwork and undergoing the stress of all documentation required, which brings us to our next key feature.
Same Day Loans can be applied online from the convenience of your home if you have a computer or even a phone. This feature helps you save a lot of time, commute expenses, and effort. Complete the process within minutes, get the loan approved within hours, and receive the money immediately. Same day loans are provided by neobanks (banks that operate exclusively online without physical branch networks) or lenders that have adopted fintech lending into their system.
The main requirement to avail the same day loan is to have a bank account and share some minimum personal and financial details. These don’t require any extensive documentation as other traditional loans do. You also don’t need to disclose the purpose of the loan which reduces further documentation.
No credit checks or collateral
These loans are often availed by middle and lower-middle-class people and thus, no credit checks, no collaterals, or guarantors are involved. Anyone can avail same day loans irrespective of their financial backgrounds. This particular feature is highly in favor of the borrowers.
Some pitfalls to bear in mind
Same Day Loans have extremely high-interest rates because of their key features. The interest rates are similar to payday loans – about 400% on average. While the interest rates per day may seem manageable, they skyrocket when annualized. To put that into perspective, many personal loans charge about 4-36% interest, while credit card interest ranges from about 12-30%.
Not being able to repay the loan on time, can put you into some serious trouble. The downward spirals of the debt cycle incur huge penalties and additional costs. This makes it impossible to repay going ahead, making the probability of a vicious debt cycle extremely dangerous.
Same day loans are the quickest and most convenient way to raise funds in a short span of time. Don’t borrow more than your repaying capacity so that you don’t feel burdened while repaying it. Read all the terms and conditions carefully before you sign the loan agreement to ensure they are in favor of the borrowers.
At EarlySalary, you can get instant cash right into your account by availing of loans for up to 5 lakhs. Witness how the power of fintech can make the same day loan application process faster and easier!
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