Benefits of Using PADs to Repay Payday Loans

Payday loans have been around for some time now. They are short-term loans that will help you get some much-needed cash quickly until your paycheck arrives. The repayment is deducted from your next paycheck, along with a small service fee. There are several ways of repaying payday loans, but the best one currently is through a pre-authorized debit {PAD}. With this choice, the money will be automatically deducted from your bank account when the paycheck is processed. Some people shun this option primarily because they do not understand its advantages. Below are the benefits of using a PAD to repay your payday loan.

Convenience

With your busy lifestyle, it is easy to forget to make your loan repayment and incur penalties when servicing a payday loan. A PAD means that you need not worry about missing the repayment deadlines for your loan. The money is automatically sent to your lender's account on the agreed date.

Cutting costs

The use of PADs to repay payday loans will negate the high transaction costs typically incurred with other repayment options. Most PAD processors will charge you a flat transaction as the service fee, unlike credit cards and cheques that charge a percentage of the transaction amount. This will amount to a tidy amount in savings over the repayment period of your loan.

Earning reward points

Most PAD processors now have a reward point system in place for their clients. By switching your payday loan repayments to the PAD option, you start racking up some reward points. For instance, if you pay $1000 using the PAD, you can earn an extra $10 for your account.

Over the years, most people have focused on the purported disadvantages of payday loans. Lenders are, however, always looking for ways to make the loans attractive and beneficial to clients. With the option of repaying the loan using a PAD and reaping the above benefits, a payday loan is now worth considering.