A cash advance is a form of short-term credit, where an individual or a company can borrow a small amount against their asset, income, or expenses. One can use this loan for both personal and business purposes. The borrower should pay back the loan at a specified time and interest charges to the lender.
Taking a cash advance can help you in times of emergency when you are short of money. It is a relatively new method of getting a quick loan from the bank. It has been gaining popularity in recent years, especially among those who need a cash injection for unexpected expenses like medical bills or home repair. With this method of borrowing, you will get your cash the same day. It is an easy way to meet your immediate needs by just applying online with the help of an internet connection.
There are the following ways to get a cash advance in Singapore.
- One way is to go to a bank and apply for an ATM card or check card that one can use at an ATM.
- Another way is to use an online lender. Many companies are now offering cash advance loans through their websites so that customers can get their cash as quickly as possible without having to travel to a store or pay fees associated with an ATM transaction.
You will then have to provide a few documents, such as your ID cards, bank statements, income proof, and credit report to process your loan. Once your documents are verified and approved, the money will be disbursed accordingly on your preferred date.
Must-Knows for Applying for Cash Advance Loan
Cash advance loan is a relatively new concept. Here are a few things that you should know about it before you apply for it –
- Firstly, decide how much money you will need before applying for a cash advance loan.
Most people take out a cash advance because they are short on funds and need some extra money to help them through until their next payday. If you know approximately how much your expenses will be until your next check arrives, you can determine how much money to request with your advance.
- You should be aware that there are fees associated with taking out a cash advance on your credit card, which will increase the total amount of the transaction. Once you have decided how much money you want to borrow, fill out an application with a Singapore bank supporting cash advance services. Some banks require customers to apply in person, while others allow them to submit their applications online or by fax. Include all the required information, including banking account information and employment history, in the application.
- Cash advance has a separate credit limit. It is a short-term loan, i.e., to be repaid within 31 days of the cash advance being made. If you do not repay your cash advance in full by the due date, it will be treated as a normal credit card transaction and therefore, incur interest charges from the day you withdraw the cash until the date you repay it in full.
It means cash advances usually do not come with a grace period, which is the period between the end of the billing cycle and when your credit card bill is due. You generally do not have to pay interest charges during the grace period. If you do not pay off your entire cash advance balance by the due date, you will incur interest charges for every day that it remains unpaid.
Types of Cash Advance Loans
1. Credit Card Cash Advance Loan
A credit card cash advance loan is a short-term loan that your bank offers you with an amount of cash at an interest rate by using your credit card as collateral. You can get your hands on the cash immediately and pay it back in monthly installments.
The main benefit of a credit card cash advance is that it’s fast and easy to apply. There is no need to submit documents, and you can get the money you want in a few hours. The rates are also low, and you can repay the loan amounts in monthly installments.
2. Merchant Cash Advance Loan
The merchant cash advance loan is an unsecured form of financing that does not require collateral to be pledged. It makes it one of the most popular and quick business loans for SMEs who have no collateral or wish to avoid putting their assets at risk.
3. Payday Cash Advance Loan
Payday cash advances are unsecured personal loans targeted at people who need money fast but don’t possess the type of credit or collateral required for a traditional loan. Usually, the only requirements to qualify for a payday cash advance are an active bank account and a job.
Eligibility Criteria for Cash Advance Loan
As with all loans, there are some criteria that borrowers must fulfill before they can be approved. For a cash advance loan, here are some of the requirements that you must meet:
The borrower must –
- Be at least 21 years of age and below 65 years
- Have a valid mobile phone number
- Have an active bank account
- Have a valid employment pass or work permit
- Be employed by your current company for at least the last six months
Credit Card Holder/Cardholder
You must be the holder of an eligible credit card or the supplementary cardholder of such a card to qualify for the cash advance loan. You may use your personal or corporate credit card as long as you have never used it to pay for gambling activities and/or any illicit transactions.
How Much Can You Borrow?
The amount you can borrow through your cash advance loan will depend on the available credit limit on your credit card. You must clear all outstanding bills on your account. Also, ensure that you have not utilized your credit limit before applying for the cash advance loan.
If you are thinking about going for a cash advance loan, reach out to OT Credit– a Singapore licensed money lender. We provide professional loan services at affordable rates. Give us a call at 6292 0119 to apply for a loan.