Fast Cash Loans Discussed

Consumers today want to do everything quickly. This is because more people are extremely busy and do not have time to waste waiting for anything.

To meet this need, restaurants provide drive-through service, banks offer online transaction capabilities, and lenders grant fast cash loans online and in person.

People can get a burger and a fast cash loan in just minutes.

Fast cash advances have not been around for long and they are still not widely available throughout the world.

Only the most advanced countries offer residents the ability to get fast cash loans today but that could soon change, due to the popularity of this financing.

Increasing Popularity

According to the Consumer Credit Counselling Service, 1.2 million consumers in the UK alone use a fast cash loan each year. Payday lending now represents a 1.2 billion pound industry within the UK.

As more people began relying on fast short term loans, word spread throughout the country. Families in the United States discovered that fast cash advances were available there as well. This type of lending continued to increase its presence but was generally undiscussed until the recent financial crisis.

In 2008 and 2009, fast cash loans took center stage and remain there today. The fast cash loan is a topic of conversation at work, home, and in politics.

Beware Of High APR

Some of the most popular fast cash loans today feature annual percentage rates (APRs) of interest as high as 2,500 percent. Compare this to the rate on a traditional loan and you may pass out. The short-term nature of the fast cash loan makes lenders able to justify offering such exorbitant rates.

When they take out a fast loan, UK consumers are usually required to repay it by the next payday so they never receive the full impact of these rates.

The interest rate has been an ongoing debate because many debt counseling agencies feel that lenders hide their rates. Lenders, on the other hand, say that publishing the APR is rather misleading because unless a customer rolls over a fast cash advance, he or she will never pay that much interest.

Lenders Must Be Transparent

For now, those in favor of full disclosure have won the battle and lenders must clearly state the APR on their written materials.

Fast cash loans do not come without their terms and conditions. These have evolved over time, starting as rather standard wording and changing to accommodate special conditions. As lenders realized that borrowers were often rolling over these loans into new ones, they needed to clearly outline how interest rates would be affected.

Fast short term loan rollover carries a form of interest compounding that many consumers would rather avoid.

The development of the Internet and the availability of fast cash loans online required additional changes within the industry. It is now much easier for unethical fast cash loan providers to set up shop because they do not need a physical store. This requires consumers to be more cautious and in many countries, the presence of online lending has led to new legislation regulating the practice.

Fast cash loans are expected to continue their evolution as more people rely on this temporary financing. Countries that have few, if any, laws regarding fast cash advances will most likely develop them as issues arise. Economic conditions frequently dictate the popularity of products like the fast cash loan and the current economy has made this financing very popular.