If you are in need of instant cash, getting a cash loan may seem like a very appealing option. There are ways to get a cash loan without a bank account. Make sure you know upfront that cash loans can be dangerous to people without the funds to pay these back, and can ultimately put you in a worse financial situation.
You can apply for a cash loan through a bank, or through a less regulated “loan-provider”. Traditionally, the application process through a bank is more in-depth, and entails more stringent credit and employment checks. These types of loans are usually termed “personal loans”. While these loans come with the guarantee of being provided through a reputable institution, the downside is that stringent credit checks are run before you can be considered for a loan. You are unlikely to secure a loan through a bank if you do not have a bank account, as there is no way for a bank to then check your credit history or to get a feel for how you usually conduct your financial affairs.
The easier route for someone without a bank account would be to apply for a loan through a less regulated loan provider. Often termed “loan sharks”, these providers are all over the Internet, and are also fairly prolifically distributed in and around the poorer areas of town.
These lenders usually provide “unsecured loans”, meaning they don’t impose credit checks on the borrower, and they also don’t have anything against which to secure the loan, like a vehicle, piece of jewellery etc. These all attract fairly high interest rates. Be careful when applying for this type of loan, as scams are prevalent here due to the often unsuspecting nature of the applicant, as well as the lack of face-to-face interaction of the online application process.
Providing cash loans to people without bank accounts generally means one of two things, if not a combination of the two:
- These loans attract cripplingly high interests rates
- The loans attract extremely large late payment fees
In both cases, the lenders are free to elevate interest rates and late payment fees, knowing that applicants will struggle to find a lender who would happily give them a loan without a bank account.
One logistical issue to taking out a loan without a bank account is that you don’t have a secure place to store the cash – you are literally walking around with a bag of cash, which can be very dangerous and risky. Lenders will play on this fact, and will usually impose even higher interested rates, taking into account the risk that this money could easily be stolen from you.
The best option, if you are looking to apply for a cash loan, is to open up a basic bank account first. There are numerous banks offering basic savings or transaction accounts with very low bank charges. Once you have a bank account in place, banks will look more favourably on you, and you will be able to apply for a bank regulated personal loan, which comes with numerous advantages and protects you, the consumer, against ridiculously high interest rates and late payment fees.