Payday loans are a specific type of unsecured short term loans. Unlike other unsecured or even secured short term loans, payday loans usually do not have a repayment term of several months or up to three years. Most payday loans are to be repaid on your next payday. That is what payday loans are by definition. You have to repay the entire loan amount along with the interest accrued when you get your next paycheck. The repayment is usually automated. Whenever your next payday is, the loan amount and the interest will get debited after your salary or wage gets credited to the bank account. Payday loans are credited into the same bank account so the auto debit works without any hassle.
Payday loans are designed for employed borrowers. Unemployed people don’t usually qualify for payday loans. However, there are some lenders who might entertain such applications. Most payday loans facilitated through Flex Repay UK are for employed adults. Minors cannot apply for payday loans. Retired people cannot apply either. Self employed professionals and business owners or entrepreneurs are a bit of a grey area. There is no illegality here but it is not always lucid if payday loans would be available for anyone to meet business expenses or for a commercial purpose.
The first thing you must know in this context is that payday loans are not designed for business owners. They are not meant for commercial purposes. However, this does not imply you cannot apply for payday loans when the urgent need of cash is not personal but for business or commercial in nature. Flex Repay in UK has a provision wherein you can specify the purpose of applying for payday loans or short term loans as ‘other’ and you can describe it. This purpose could be buying a piece of equipment for your business. You may need some urgent cash to make impending payments. You might need some help to take care of your recurring expenses. There can be a myriad of reasons why you might need some fund and all such realities can become your purpose for choosing payday loans.
It is of course the discretion of the lender whether or not your purpose will be accepted. In theory, business purposes would not qualify as legitimate grounds for approving payday loans. There is no payday in its stringent sense so a repayment date cannot be fixed. In practice, an impending invoice or expected cash inflow can always be treated as an equivalent of payday or getting paid by an employer. The same rationale applies to self employed professionals. Anyone with a commercial purpose and one who does not have an employer can use invoices or other proofs of expected payments to apply for short term loans. This is how cash advances, lines of credit and other short term loans for businesses work. Would payday loans work in the same manner for any and sundry?
The answer is no. There is no thumb rule or general practice here. Many lenders will not even consider business owners or self employed professionals for their payday loans. They would have a policy of verifying the employment status and only then would they process any application. Approval would be stringently dependent on this singular factor. However, there are lenders who may be willing to entertain applications for payday loans from business owners or self employed professionals. You would need to find such lenders.
When you apply for short term loans through Flex Repay in UK, you would get to provide all the details that matter. You would get access to various lenders with one application and they would send you their propositions. You can study their propositions and decide if they suit your purpose. Some lenders may not offer you a quote. This would obviously imply that they don’t expect one or more of your personal or professional details. If lenders send you a quote, then your application is prima facie accepted. This is not a surefire sign that your application will be approved and that you would get the loan. Eventually, whether or not you can get payday loans for business or commercial purposes, as a self employed professional or entrepreneur will depend on the policies of the lender.