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If there are times when you need an advance before you get your paycheck, Cash App loan money could be a lifesaver. After all, sending and receiving money from the peer-to-peer payment service is so simple. The good news is that there is now a Cash App Borrow feature. Here’s everything we know about it so far.
Does the Cash app allow you to borrow money?
Yes, Cash App allows you to borrow money. However, it is still in the testing phase, not available to everyone, and limited to loans of $20 to $200.
According to Tech Crunch, the loans fund quickly and require you to repay them in four weeks or less. But keeping a balance this long can add up – Cash App charges a flat 5% fee to borrow, plus an additional 1.25% per week after the grace period.
As long as you go in knowing that a Cash App Borrow loan is best for quick repayment, the new tool could come in handy when you’re low on cash.
How to borrow money from Cash App
As mentioned, Cash App Borrow is not yet available for everyone. The only way to know if you can is to check. Follow these 10 simple steps on how to borrow money from Cash App:
- Open the Cash app.
- Tap on your Cash app balance located in the lower left corner.
- Navigate to the “Bank” header.
- Check the word “Borrow”.
- If you see “Borrow”, you can take out a Cash App loan.
- Tap “Borrow”.
- Tap “Unlock”.
- Cash App will tell you how much you can borrow.
- Read the user agreement.
- Accept a Cash App Borrow loan.
Is the Cash app secure?
It is too early to analyze the security of a Cash App loan application, but the Cash App platform itself is secure. Cash App ensures that your money and personal information is protected in several ways:
- The app integrates with your smartphone’s screen lock, where PIN entry, Touch ID, passcode or facial recognition add an extra layer of protection in case of loss or theft from your phone.
- You can deactivate your Cash App card if you have misplaced it or for added security.
- You can set up email, text, or push notifications to help monitor your activity and alert you to unusual account usage.
What other ways can you borrow money online?
Having access to cash quickly can make all the difference when you need cash. Most people turn to funds in an emergency savings account, borrow from loved ones, or charge expenses to their credit card.
Quick loans have their downsides, such as incurring personal or credit card debt or charging high fees. While Square is testing the Cash App Loans feature, consider the following alternative loan options to get the cash you need fast.
Timely offers an “affordable alternative to payday loans” and may be better suited to borrowers with no or bad credit history. You can borrow between $300 and $10,000 for up to 48 months. Oportun recently began capping loans at a maximum of 36% interest to back up its claim of affordable loans.
You can borrow between $1,000 and $40,000 per loan club. Once you establish a track record with LendingClub, you may be able to borrow two loans at once, which could be a useful way to fund your shortfalls with different repayment periods and repayment amounts.
LendingClub charges a 3% to 6% origination fee for each loan. You’ll have up to five years to repay the loan in full, but don’t delay too long, you’ll pay an annual percentage rate of 7.04% to 35.89%.
Opp Loans is another loan company that specializes in loans for bad credit, offering no credit checks and amounts from $500 to $4,000. OppLoans has repayment terms of up to two years, which is ideal if you need more time to pay off the debt.
Although the ability to repay the loan over a longer period relieves some of the pressure, caution should be exercised. OppLoans can charge an APR of up to 199% on the amount you borrow.
keep in mind
As with all loans with bad credit or no credit score, it is important to monitor the APR. Otherwise, you could end up paying a lot more interest than the original amount you borrowed.
A Cash App Borrow loan seems like a good option for a short-term loan for a few dollars. When considering other online loan options, consider the cost of borrowing as well as the lender’s repayment terms.
Most online lenders claim they will make loans cheaper than a payday loan, but the loans are still quite expensive if you don’t pay off the balance quickly. Make sure you understand what you’re signing up for and if you can really afford to borrow.
Rates and fees are subject to change.
This article has been updated with additional reports since its original publication.