Payday Loans compared

Your guide to all Payday Loans

Payday Loans are suitable for those with any type of credit rating and can be acquired instantly online.

The other services which payday loan companies are offering

You may have seen these types of stores when you are in your local shopping centre: businesses which offer payday loans and a type of credit which is known as cheque cashing. In this article, we are going to look at the type of credit which is very similar in nature to that of payday loans.

Cheques are a dying breed of payments – one of the reasons for this is because of the way that the whole processing time of a cheque can be anything up to and beyond five business days. Because of the immediate world that we live in, many people are finding that they simply cannot wait all that time for the cheque to process, and this is where cheque cashing services come in.

There are practically hundreds of these services up and down the country, with a borrower entering one of the stores with a cheque they wish to cash. The lender provides cash in hand for the main amount of the cheque, after deductions that include a small handling fee and a percentage of the cheque’s value. From there, the cashier proceeds to process the cheque themselves, and that is how the business model works.

Cheque cashing can be regarded as extremely similar to payday loans because of the way that the method of finance acts as a catalyst for borrowers who cannot wait for money to come through. This could be because of an emergency, or because of financial mismanagement.

All of this comes as the humble cheque is being phased out. According to the UK Payments Council, the payment method will no longer exist in around eight year’s time – with the cheque being officially discontinued from 1 November, 2018. Even though it does seem a long way away, the decline is going to have to be relatively steep. There were still close to 700 million cheques written in 2008, meaning that they are still in circulation quite significantly in some areas – and particularly amongst the elderly.

For those who want a quick answer to cash, there will be other options. Speaking about the discontinuation of the cheque, Paul Smee said: “There are many more efficient ways of making payments than by paper in the 21st century, and the time is ripe for the economy as a whole to reap the benefits of its replacement."