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For many, the fees associated with payday lending is often one of the downsides to this type of loan. However, there are many benefits to a payday loan, as well. Some of the benefits of payday lending include a quick approval process and the ability to secure a loan even with poor credit. Payday loans are unsecured loans for relatively small amounts of money.
The approval process for payday loans is usually rather quick. This is because these loans are approved based on the applicant's net monthly income. With this information, the lender can quickly determine whether or not the applicant will be able to repay the loan on the next payday. Additionally, the lender is able to offer the applicant an unsecured loan even if the applicant has poor credit. The lender is able to do this because, in most cases, authorization to withdraw the funds from the borrower's bank account automatically on payday is established. As a result, the lender is able to recoup the loan amount automatically.