Advantages and disadvantages of online payday loans



Many people who need quick cash try to get it by taking a loan. Nonetheless, on a stationary basis, the process of granting it takes a very long time. We have to meet a number of formalities, such as verification and in the Economic Information office, which will inform lenders about our possible liabilities and debts from previous periods. You should also find a guarantor who will confirm our credibility when taking out a loan. These types of formalities are not required by companies offering online payday loans, which is why more and more customers are choosing them. However, few people know that they have both pros and cons:

What are the advantages of an online payday loan?:

What are the advantages of an online loan?:

Fast online payday loan in the eyes of people using it is primarily distinguished by the speed of its granting and implementation. However, it also has other advantages;

1. Not very complicated procedure and minimizing formalities

You must be at least 18 years old to be able to take advantage of an online payday loan in our country. There are even special online payday loans for 18 years that are dedicated to young people. It should be noted, however, that an ID card will be necessary for the procedure. We should know that only three documents are considered as proof of identity in the country. These are of course your ID card, passport and driving license. Another formal requirement set by the lenders is the Polish citizenship of the person applying for the loan. Once we meet the formal requirements, we must complete the application, which we will certainly find on the website of the loan company whose services we intend to use. The next step on most pages of this type is to provide your personal data. To confirm it, before obtaining an online payday loan, you should usually transfer a small amount to the account of the loan company to which we address our application. Most companies require a confirmation fee of only the proverbial zloty. The decision to grant the payday payday should appear very quickly, as the application will go through the entire procedure without proof of earnings or employment.

2. A quick online payday loan is possible without guarantors and procedures at BIK:

Online installment loans that offer us online payday loan companies do not require collateral. We do not even have to submit income declarations for persons who are our guarantors. Thanks to this, the borrower in the future, if the loan is not repaid without certificates , will not be stuck in society, and his relationships with friends will not suffer because of this.   In addition, online lending companies do not check borrowers at BIK. Therefore, people who have any debt can easily receive such a loan.

3. An online payday loan gives you the opportunity to get money in a few minutes:

Taking into account the minimum formalities, the decision to grant a loan is very quick. After positive verification, most companies offering loans transfer money to a customer’s account even a few minutes after it. Of course, you need to consider the hours of booking at various banks, which can have a decisive impact on when we receive the money granted by the online payday loan company.

4. Option to send a loan application at any time:

Few people realize that we can apply for an online payday loan at any time of the day or night, unlike its stationary counterparts, where opening hours apply.

5. No installments and quick repayment;

For some applicants, it may be a plus that quick online payday loans are paid back once, rather than installment loans from traditional loan companies or land-line banks. Thus, online payday loans are repaid within a short period.

6. Conclusion of the contract without leaving home:

One of the major advantages of online payday loans is that you don’t have to leave your home to apply, which makes the procedure much easier and faster.

7. Much better promotions

If the company to which we apply for an online payday loan also has a fixed-line offer, I usually propose much better conditions via the Internet. That is why it is worth looking around for the offer of network matches.

What are the disadvantages of an online payday loan ?:

What are the disadvantages of an online loan ?:

Online lending companies grant payday loans quick and without additional obligations, but they compensate in a different way. It is possible to set much higher commissions, interest rates and fees from traditional loan companies. However, these costs vary depending on the company that grants the loan. That is why it is best to review the ranking of payday loans available online. The main disadvantages of online payday loans are:

1. Large costs:

If we want to take out a loan online, we must take into account the large costs that we will cover. However, companies to which you can apply for a loan are required to inform us of any fees. However, if we decide to take an online payday loan, we will face costs such as:

– interest rate

– commission

– insurance

– additional fees (e.g. during registration)

Some companies that offer online payday loans to attract customers give up the additional costs incurred by the customer. However, most of them impose high fees on borrowers.

APRC – the Real Annual Interest Rate is quite high due to the short repayment period of online payday loans.

2. Large costs of extending the repayment deadline:

The online payday loan extension period can be extended, but the costs involved are very high. It should also be noted that the additional fee for extending the loan repayment period depends on the period for which we want to extend it. However, it is always better to use this option and lose more money than wait for debt collection.

3. Risk of falling into a debt spiral:

online payday loans due to the fact that they are granted without unnecessary formalities and checking any previous commitments, can be taken by virtually anyone. That is why a lot of people who already have earlier debts, apply for payday loans, available on the Internet, hoping that they will be able to pay them back. Unfortunately, they usually get into more debts in practice, with no money to pay for a loan from an online payday loan company.

4. Subsequent accrual of additional costs:

Although there is an anti-usury act in Poland, some loan companies offering their payday loans online do not comply with it. Unfortunately, we must read each contract before signing, because some fees may be written in a small print. Nevertheless, some companies do not report them at all, thus breaking the law.

5. False loan companies:

Applicants for online payday loans must be aware of the possibility of fraudsters on the web who are setting up websites of alleged loan companies. However, they are not usually about extorting money from customers for additional fees, for example, but about something far more valuable. Well, phishing websites are phishing personal data. Therefore, it is best to consult other network users or friends who have already used the services of a loan company much earlier before sending the application.

6. Lack of direct contact with the lender:

Some people, especially the elderly, cannot imagine signing any contract without first discussing it with a living person. In the case of online payday loans, the whole procedure takes place without unnecessary face-to-face contact, which may be incomprehensible to an older person who has become accustomed to her every time he tries to do something. In addition, this type of procedure may not be available to her simply because she is not familiar with the general computer rules.

7. Low loan amount:

Due to the quick processing of the application and minimum formalities, online payday loans are granted only when applying for low amounts. They may fluctuate around several thousand zlotys. Everything, however, depends on the individual rules that the company will determine. One company will grant us, for example, only 1000 zlotys, and the other with the same applicant and all formalities fulfilled, even 10,000 zlotys.

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