The promise of quick cash can be tempting. Instant payday loans are promised by some lenders. The phrase can be enough to lure borrowers in.
But how instant can a loan really be? What is an instant payday loan and how long can you expect to wait?
Instant payday loans
If you search for instant payday loans online, you will see a long list of results.
Some of these lenders are smaller, but others are well-known names.
Only once you dig a little deeper can you discover what ‘instant’ really means.
The payday loan application process
If a payday loan could be truly instant, then you would receive the money at the click of a button.
The reality is slightly different.
You will need to fill in a detailed application form. Lenders will ask for personal details, employment information and some personal finance figures.
Filling in forms will take time in itself, but these details are important. They enable lenders to carry out their stringent checks. Lenders have a duty to make sure that you can afford the loan that you apply for.
After you have filled in this form, the lenders must use the information. They will then likely run a credit check, based on the details that you have provided.
Lenders will also have their own criteria. Before you can borrow money, there may be calculations to ensure that you meet these requirements.
At this stage, you may receive an approval in principle.
Often, no further details are needed. If that is the case for you, then you will be told that your loan has been approved once you complete your application. This is as close to instant approval as a payday lender can promise.
In other cases, there may be further checks needed. You may need to send more evidence of your identity or income, before the money is sent to your bank account.
You may find that your application is approved in principle, but you are later told that you cannot be offered a loan at this time.
Quick cash sent to your bank account
Lenders will have their own payment processing hours.
Your bank will, too.
Some lenders process payments at all times of the day or night, and can state that money will be sent to your account within 10 minutes. Other lenders process payments every few hours in bulk.
Once the money has been sent by the lender, there is always a chance that it can take time to reach your bank account. Sometimes, this process can take up to 24 hours.
In most cases, the bank transfer process will be almost instant. This means that quick payday loans could be in your account just 15 minutes after they are approved.
No payday lender can guarantee the money will reach you instantly. Although they can provide you with details about their own payment processing times.
Loan application process times
Lenders will provide information, on their websites, about typical processing times.
QuickQuid and Pounds to Pocket claim to provide approval within 30 minutes of an application, in the majority of cases.
With QuickQuid, cash is then sent within 10 minutes of approval.
Most banks accept Faster Payments. This means that you will receive the money almost as soon as it is sent. If your bank does not support this feature, you could be waiting up to 24 hours for your money.
This is still significantly faster than applying for a traditional bank loan. In emergency situations, when you have important Direct Debits to cover, these quick payday loans could reach your account in time.
Read this overview of how quickly you can get my loan?
The benefit of online loan applications
Applying for a traditional bank loan can be a particularly slow process over the weekend, or during a public holiday.
Payday loans, on the other hand, are available at all times.
Many lenders allow you to apply online, without any in-person meetings. This means that you can make an application 365 days a year, and 24 hours per day.
In most cases the approval process is automated. This is what makes it so fast.
Quick payday loans are usually offered because computers do the required calculations.
The computer decides whether to approve your loan application, based on provided information.
In cases where further information is needed, you may need to wait longer for your loan application to move on. If your case is straight-forward, you could get the money that you need even on Christmas Day.
Watch out for payday loan website wording
No reputable lender will guarantee instant payday loans. They certainly will not promise instant money without a credit check.
If you have any doubts, you can check the Financial Services Register to ensure that the lender is authorised.
Of course, lenders can make efforts to reach people that are searching for instant payday loans. Many will have sections on their websites that mention instant payday loans. But will detail the actual approval and payment times.
You should also take care to recognise the difference between an instant payday loan – one that immediately reaches your bank account – and a loan offering an ‘instant payday’.
Some lenders may use the term ‘instant payday loans’ in the latter context, to say you could have an interim ‘instant payday’ today, even if your wages are not yet due in.
Valuable time to think about loans
If you are looking for an instant payday loan, then you may be struggling financially.
Many applications are from people that are experiencing a genuine temporary cash shortfall. There are also plenty of applications made in moments of stress and panic.
Applying for a loan should not be an impulsive decision.
Whilst instant payday loans can sound appealing, you may actually enjoy an application that takes a little time.
Having to go through an application form, providing information about your income and expenditure, could help you to make clearer decisions. As well as help you consider if you really need the loan.
You may use this time to re-evaluate your need for a loan. As you progress through the process, you will have time to think clearly about your needs.
Speeding up the loan application process
If you are sure that you need a loan as quickly as is reasonably possible, then there are a few genuine ways to fast-track the process.
Do not be tempted to use an unregulated lender, making unrealistic promises.
Payday loan brokers
By using a payday loan broker, you can apply to many lenders. One application form goes to a portfolio of approved and regulated loan providers. You do not need to rely on just one lender’s approval.
When you apply direct and your application is not approved, you may have to go through the entire process again. Each time you make an application, you may be reducing your chance of approval.
Though an instant payday loan is not realistic, you may be able to save some time by reaching a selection of lenders in one go.
Cash Lady can send your details to an approved portfolio of loan providers. As such bringing you results from the lenders that have approved a loan in principle.
Applications in person
Some lenders, such as The Money Shop, have physical stores as well as online presence.
If you need a loan during store opening hours, then you may be able to get the cash quickly by visiting The Money Shop in person.
You can take evidence of income, identification and other important documents to be checked by a human being.
If you live close to a physical branch of The Money Shop, this may be faster than waiting for approval online.
In the most straightforward cases, an online payday loan application is almost the easiest and quickest option.
If you suspect you may need to supply further evidence, a visit in person could save waiting around for your application check elsewhere.
No responsible lender can promise instant payday loans. Yet, many can send money within an hour.
Applying for a loan is a process that involves forms, credit checks, an approval in principle and a thorough affordability assessment.
This process is often automated using complex computer systems. You do not need to wait for a human response, in a majority of cases. Despite this, you may be waiting for a short while whilst your details and credit scores get checked.
Most loans are approved online with no further delay. You may need to provide extra evidence, which can slow the process down.
Many lenders can offer approval within half an hour. With the fastest lenders, the money could then be sent to your bank account within 10 minutes. If your account supports faster payments, the transfer could be instant at this point.
Lenders will clearly mention, on their own websites, how long their approval process takes. If you need an instant cash loan, check this information before you go through the application form.