Isn’t a Payday Loan Just a Micro Loan?
Micro loans are similar in size and appearance to a payday loan, and yet fundamentally different on a number of levels. These bear some looking into for those who may be seeking one or the other type of loan. Knowing as much as you can is always best with your finances, and that is why cashdoctors.com.au wants to give you all the facts.
To start, we can begin with the similarities in the two modes of lending. Both loans concern themselves with amounts or people not considered "bankable". This doesn't refer to whether or not the bank feels they can keep you in their vault. It means that they don't feel the small amount of money they could make in interest justifies the risk they are taking on you with the loan. Both loans require less paperwork, and less hassle than a typical bank loan.
At cashdoctors.com.au we have this lowered paperwork down to an art. Just log in to cashdoctors.com.au, and sign up for your Cash Doctors card. Then when you need your payday loan, or just your cheque cashed, all the paperwork is already taken care of, and you can get on with your life.
Now that we understand the need and similarities for both loans, we can look more closely at just what defines them from one another. We can start with the micro loan. These are typically enterprise based, and concern them selves with giving small loans to get by immediate problems to help people break the cycle of poverty. This can take the form of a raw materials loan, or even one to get a computer. Typically, micro loans come from some sort of relief agency hoping to help people help themselves.
Payday loans are more tailored to immediate personal needs. What you use the money for is your own choice, and can be anything from a surprise expense to a personal splurge. Payday loans are also short-term, based on you paying when your cheque arrives. For this reason, they are typically based on a fixed price rather than an interest rate that builds over time. Here again you can see that the operative word in payday loans are freedom. It is a quick way to get your money now without the looming spectre of interest hanging over your head.
Each of these loans has certain purposes at their core, and each serves those purposes well. It is just a matter of the need that determines which is best at the moment.
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