A payday loan is a short term loan that is granted to employed individuals that is due on the next pay day. The borrower instantly gets that amount in his/her bank account. Thus these are the most liquid types of loans around.

Those who want to get a payday loan, they go to payday loan lenders. Traditionally, all the pay day loan lenders used to operate verify their client's income source and alike. The borrower is given the amount upon verification and approval from the lender. In return, borrower gives lender a signed check. If borrower does not return the loan and the additional fee to the lender on or before due date, the lender then redeems the check.

However, today, payday loan lenders do not operate this way. Instead, more than 80% of the lenders operate electronically over the web. For instant, www.instantcashadvanceusa.net is a US based payday loan lender that operates electronically. A potential borrower fills out an application form over the internet, submits it and upon approval, funds are transferred to his bank account. And lender, withdraws the loan amount and fee directly from the borrowers bank on his payday.

According to a recent research, a fairly large number (more than half) of the lenders do not ask for any proof of income while giving payday loans. Interesting.

And according to another research, about 15% of the borrowers do not return payday loans. Or the risk that payday lenders have to face is extremely high. And this is the reason that the fees and late payment charges of payday loans are way too higher than normal loans.

It is not hard to say that payday loans are helping people a lot. I mean there is no point in saying that these are useless or something. Of course, they carry a very high interest rate and fee, but people do not hesitate to pay a very high fee for a sheer amount when they desperately need cash. The best thing about payday loans is that you get money when you need it. In a few hours. There are lenders out there that will literally approve your application within 5 minutes or so.

You can use payday loan in several different ways. There is no limitation as to how you can use your payday amount. You can use your money in any way you need. Most of the people get a payday loan when they are out of cash. Or when they need cash in emergency. Although there is no fixed amount of loan that you can get, but generally you can have $50 to $2000.

Since the interest rate and fee of payday loans is very high, most of the people do not bother to apply for a payday loan. Alternately, these guys borrow money from their peers, friends and relatives, which is interest-free loan. It is much better to go for other options (if you have) when you need small amount of cash on urgent basis. A payday loan must be your last option.

But at times, it gets necessary to get a payday loan. In such a case, you need to do some calculations. See whether it is feasible to get a payday loan? Can you repay the loan and fee before due date? It is strongly recommended to apply for least amount. If you need $500, then apply for $500 only. Do not apply for more than this amount. This is because, your fee and interest rate will increase with the every single buck you add to the loan amount.

A payday loan is indeed very helpful. This is the reason that the number of payday lenders and borrowers have increased significantly over last few years. Take as much advantage as you can from payday loans to improve yourself financially.