A payday advance is a sure short-term solution to a financial problem. It is an option that many people use to meet unexpected obligations or to fill in the days when there is no cash in hand at the end of the month. The reason for calling such short-term solutions as payday advance is because they are designed to be repaid in full along with other charges on the next payday. It is compulsory for the borrower to have an active bank account as the funds are deposited directly into the bank account, usually within one working day and when the loan is due for repayment, the money is withdrawn from the same account. Usually no credit checks are involved and no collateral is ever required. The lender loans the money with the understanding that it will be repaid automatically from the borrower’s bank account on the day it is due. Payday advance should not be considered as a long-term solution as repeated use could lead to a debt trap.
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