Payday lenders can often be compared to loan-sharking. Critics believe these lenders exploit those who are so desperate for cash fast that they end up taking out loans that have absurdly high interest rate. Pew Charitable Trusts 2012 research has shown that the typical payday loan borrower takes out eight small-term loans per calendar year. The average amount is $ 375, and the interest rate over the same period is $ 520. Find out Bridge Payday Loans here!
Learn more about short-term loans
These short-term loans are intended to be used to pay off a loan until payday. But, all too often the borrower finds it difficult to repay the loan fully when his next paycheck comes in. The borrower will then turn the original payday loan into a second one, which comes with new fees. Each subsequent loan is much more difficult to repay.
It’s easy to see how debt can quickly accumulate. It is easy to see why payday loan are ridiculed and demonized. John Oliver made this hilarious observation in “Last Week Tonight.”
Many people will be interested in an alternative to a scam. Sometimes, payday loan options have been offered with better terms than the traditional check cashing operation. BridgePayday, an innovative startup from Palo Alto that recently received $ 4.1million in seed capital, is trying something new. Instead of offering short-term loans, the app allows hourly employees, regardless of their usual pay cycles, to be paid immediately for hours they have worked.
BridgePayday, which is also a plus (and this seems to be what really seems like the crazy part), BridgePayday charges no fees. BridgePayday does not charge any fees. Asks users to make a 100 percent voluntary tip in appreciation for the service.
There could be many reasons you’re thinking, “Huh?” BridgePayday FAQ Page According to the company, the service is available for anyone who is paid an hourly rate by direct deposit at the bank and keeps track of their hours with an online log. Once you have signed up, the service allows you to choose whether you want to be paid for all or part of the hours worked. This includes taxes and deductions. So if your Monday work day ends on Monday, and you still want to get paid, you won’t have the Friday paycheck. BridgePayday allows you to log in as soon your Monday day is done. Send a request for payment to BridgePayday and you’ll be paid electronically by the morning. BridgePayday will pay your salary when it arrives. Withdraws the amount it has been credited from the user account.
What about the loan fee?
BridgePayday provides voluntary tips to replace service or loan charges. “We don’t think people should be required to pay for the services they don’t use,” says the policy. So we ask you to choose what you consider fair based your personal experience. BridgePayday BridgePayday claims that the no cost model isn’t a scam. BridgePayday: “Some people look at this model and think we are crazy.” Wired interviewed Ram Palaniappan founder. He said, “But we tested the model and found it sufficient to build an sustainable business.”
Palaniappan added that people don’t know the model and think it’s too good be true. They view us with a horrible standard. We are not doing anything that is too good to believe. It is what we have lived with for too long that is unacceptable.
BridgePayday Advocates for consumers are warning against the use of this service due to its warm and user-friendly, toll-free business model. “It seems like an affordable option to other emergency options such as payday loan,” Gail Cunningham (National Foundation for Credit Counseling) said via email in response our BridgePayday request. . . “However a person who is so grateful to have $ 100 risk becoming a big tipstamp, not realizing the fact that the way they say Thank You is costing them an extremely high APR annually. A tip of $10 on a A$ 100 loan for 2 weeks equals an APR at 260%. “
Need emergency cash?
Consumer watch groups don’t endorse BridgePayday You should not rely on it. Start. Tom Feltner, the director of financial service for the Consumer Federation of America, said that if you don’t access your money soon, you could run out of money when your bills are due. “If there aren’t enough paychecks at week’s end, it may indicate a more long-term financial imbalance,” he said.
Cunningham stated, “Everyone thinks that they’ll use it ‘just one’ time but it becomes such a simple fix that they end-up getting hooked on easy money.” Cunningham said that it is much better to look into the root causes of financial problems and find a permanent solution. I would suggest that anyone who has used non-traditional services three or more times in the past 12 months should consult a financial adviser to address the problem. Treasury. Treasury.
BridgePayday has another aspect. Some might find the need for direct deposit or a bank account to be decisive. Many workers are more likely to find payday loans appealing than those who do not. You don’t have a bank account.
BridgePayday can still be a great option for those who qualify and are in financial trouble. A payday loan is a good option if you aren’t feeling pressured. High fees.