Cash Advance Apps: What You Need To Know, Plus Our Top Picks

Unexpected financial emergencies can surprise even the best of us. However, not everyone knows what to do and how to deal with the issue. One of the possible solutions is cash advance apps that allow consumers to borrow a small amount until their next paycheck.

The paycheck advance app market has grown exponentially and is often considered as one alternative to expensive payday allowances. But some people are concerned about the potential risks of them.

Anyway, when taking things seriously and not acting emotionally, you can safely use paycheck advance apps in one-time emergencies to avoid an overdraft fee or get cash fast before your next paycheck. Keep reading to find out more about fast loan apps!

How do Cash Advance Apps Work

In general, these apps let you get a small-dollar loan today and repay it later over time. The amount advanced is automatically deducted by the application in one sum when it’s due date (~2 weeks). Depending on the app, withdrawing repayment might be once your paycheck is deposited in your account. There are three types of apps available on the market.

Direct-to-consumer apps

The most common usage of paycheck apps that allows users to get a short-term allowance, even despite an upcoming paycheck or direct deposit. Examples of DTC apps include Earnin, Dave, Varo, and Brigit.

Small-loan apps

Some applications also offer “advances” up to $100 to both members and non-members. These small loans can come in the form of an automatic overdraft protection service or as of the time of employment if requirements are met.

Earned wage access apps

These types of Instant Cash Advance apps work directly with employers, who should opt in before an employee may access wages already earned. Examples of EWA apps include Pay Activ, DailyPay, Branch, and FlexWage.

Note: applications may charge for a monthly subscription, request a membership fee or optional tips. However, in 2020, the Bureau gave an opinion that changed the rule for EWA cash advance apps. It stated that these programs that receive optional fees in the form of tips should not be exempt from the Payday Lending Rules. Particularly, they need to be considered as lenders and therefore be required to provide APRs associated with monthly subscriptions or tips.

How to Choose the Best Cash Advance App

When you are evaluating paycheck advance applications, keep the following criteria in mind:

  • Ease of use
  • Where it is accepted
  • How it affects your credit
  • The cost of borrowing from an app
  • The interest rate

Our Top Three Picks

While there are lots of different apps for cash advances and other short-term allowances out there, not all of these platforms can be trusted. Thus, we have ranked and rated three top paycheck advance apps so that you can take an urgent loan with confidence.

Earnin

This app uses either your location or a timesheet to track your hours worked, and based on the amount, it allows you to borrow the cash you have already earned but not be paid. Among other features, Earnin notifies you when your account balance is low and then offers to deposit it for a fee.

Max amount: $100 (overdraft protection), $500 (cash out), and $1,000 (cash out via Express).

Fees: it asks for an optional tip, which is limited to $14 for cash out. As for the overdraft protection service, it automatically sets a recurring tip of $1.50 minimum.

Speed: financing time usually takes one to three working days. If you need money fast, you can apply for Earnin’s Lightning Speed feature and get the desired amount instantly.

Repayment: the app withdraws the funds you borrowed on your next payday.

Dave

The app is ideal for small-dollar allowances that can help you to cover your needs while you wait for your paycheck. Also, if you create a Dave spending account you will be able to borrow money larger loan amounts. Another great feature of Dave is “Side Hustle”, which offers customers side gigs to earn extra cash.

Max amount: $100 for an external account and $200 for Dave’s spending account.

Fees: the company charges $1/month subscription fee and optional tips up to 20% of the amount borrowed. If you want to receive an advance within eight hours, you will be charged between $1.99 and $5.99, depending on the advance amount.

Speed: it takes up to three working days to receive your cash from the app. However, you can get your funds within eight hours by paying the express fee.

Repayment: the withdrawing repayment is set to your payday, but you can change the terms.

Brigit

This app provides innovative budgeting help that can get you up to $250 in case of an emergency. Brigit’s free plan offers a budgeting tool and financial advice only. To get access to other features of the app, you need to use the paid plan, which includes advances and automatic payments, among others.

Max amount: $250 for both instant deposit or auto advances (automatic overdraft protection).

Fees: $9.99/month subscription fee.

Speed: you can receive money the same day if you apply for it before noon. Otherwise, it will arrive the following working day. Also, there is an option to receive cash within 20 minutes with a linked debit card for no extra fee.

Repayment: the app sets your payment date according to your next payday. But you can change the due date in the app.

Final Verdict

The bottom line: a cash advance app may be a good decision if you need to cover your needs or make a purchase that’s just outside of your budget. Consider them as one-time options for emergency allowances, and try to pay them off as fast as possible.

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