There are certain things that can only and only be addressed by cash. Times come, when the availability of cash is truly limited and a Cash Advance is something that many use for addressing such situations.
While borrowing from friends/family is an option, people tend to avoid it for reasons like the act of borrowing being a threat to one’s status, the limited reliability of borrowing from known people, and so on.
It is hence not surprising to see why cash advances are a preferred solution – for a little extra expense that can be spread over time, a borrower can get a reliable solution for cash needs. Cash Advances can come in the form of the typical Credit Card Cash Advance and the rather recent trends of Direct Lender Cash Advances and Cash Advances against Debit Cards.
Credit Card Cash Advances vs Cash Advances against Debit Cards
Typically when the term “Cash Advance” is used, most people think of a Credit Card Cash Advance. Many borrowers are unaware of Debit Card Cash Advances as they’re not a very strongly formalized product.
A Debit Card Cash Advance is simply a transaction where you use your Debit Card at a bank’s teller/ATM to withdraw cash; while your Debit Card is issued by another bank. The amount is given to you provided you agree to a fee (where applicable) and provided that your account is able to reflect the amount in your bank balance.
Advantages of Debit Card Cash Advances
- Low fee
- Withdrawal past ATM limit fee (if hit in your bank’s ATM)
- Withdrawal without the need to find one’s own bank ATM/branch
- Credit score stays unaffected by such a transaction
Limitations of Debit Card Cash Advances
- One needs to have a bank balance greater than the amount been withdrawn
- Physical presence at an ATM/teller is required
- If a day’s withdrawals and pending dues are not carefully calculated, an overdraft fee may be charged for excess withdrawals.
The Alternative – Direct Lender Cash Advance
Direct Lender Cash Advances from non-bank direct lenders are the cash advances you can avail without the need for a credit card or a debit card. A bank account shall be needed for the transaction.
These are typically higher in fees/expenses in the form of interest. However, certain distinct advantages make them desirable to many borrowers.
Popular advantages of Direct Lender Cash Advances are:
- These advances can be available to bad credit borrowers
- Established and efficient lenders typically provide funds in approximately one day
- Some lenders have a fully online application, approval and deposit
- Direct lending involves less paperwork and minimal formalities
- Bad credit borrowers are accepted by many direct lenders
- Borrowers do not need to have the money they are borrowing but instead need to have an income to cover for it
- Unlike a Credit Card Cash Advance, direct lenders do not need their customers to have an existing relationship.
Debit Card Cash Advances and Direct Lender Cash Advances are both having their own distinct advantages that are suitable over the typical Credit Card Cash Advances for borrowers with different needs, having different limitations.
Debit Card Cash Advances come in use when one has healthy bank balance but doesn’t have a Credit Card and doesn’t have access to withdrawing cash from one’s own bank.
Direct Lender Cash Advances are useful for people who don’t have enough bank balance to address their needs, and have no Credit Card and/or a poor credit history, making other forms of Cash Advances an unavailable option.