Cash Advance Apps for Money Before Payday

In 2022, 33%  of Americans used cash advance apps. Sure, these popular apps can help you cover a financial emergency between paychecks, but unfortunately, they tend to create more problems than they solve.

Even if cash advance apps help you figure out how to get money before payday, more than 30% of the borrowers who use the apps say they struggle to pay back their debt, and 17% have had to skip another bill to pay the money back. Plus, several popular cash advance apps have faced class-action lawsuits from customers.

If you’re considering a cash advance app, keep in mind that there are far safer and more affordable ways to come up with cash. Even if you don’t have an emergency fund saved up to cover your expenses, there are several alternatives to consider.

What Is A Cash Advance App?

A cash advance app is a service that gives you cash, and you pay it back from your next paycheck or your next government benefit deposit. The app typically collects the money through an automatic debit taken from your bank account on your next payday.

Unlike payday loans, a cash advance from an app is not technically a loan. Depending on the app, you may or may not have to pay fees, and you can sometimes opt to leave a tip or pay a fee to receive your advance immediately.

Generally, the process of taking a cash advance from an app goes like this:

1. Download the app.
2. Connect your bank account.
3. Provide information and/or documents to verify your income and pay schedule.
4. Receive your cash advance.
5. Repay the advance via an automatic debit from your bank account.

Here is a look at some of the apps and what they will do for you.

1. EarnIn

Earnin can advance you up to $750 from your next paycheck. You won’t have to pay any fees for the advance but Earnin does accept tips up to $14 per transaction.

While tipping might seem like a great way to show your gratitude for the free service, it can be surprisingly expensive. A $10 tip on a $500 cash advance that you pay back after two weeks is the equivalent of 52.14% APR.

• Maximum amount: $750 per pay period
• Fees: No mandatory fees or interest. Tips are optional. Lightning Speed transfers are available for $0.99 to $3.99
• Speed: 1-3 business days
• Repayment period: Your next payday

2. Brigit

Brigit is an app that offers small cash advances with no late fees or penalties. If you’re afraid of missing a Brigit payment, you can use a free credit within the app to extend your due date.

The app also sends you a notification if it looks like you won’t have funds to cover your upcoming payment, and then offers you another cash advance to cover the difference. While that might seem like a nice convenience, it can increase your risk of getting caught in a debt trap or a loop of borrowing money in order to pay off debt.

• Maximum amount: $250
• Fees: Free membership available, or Plus Plan for $9.99/mo
• Speed: 1-3 business days
• Repayment period: Choose your payment date

3. Current

Current doesn’t provide cash advances, but their Overdrive feature allows you to overdraft between $25 to $200 on a Current bank account, with no overdraft fees.

There are, however, a few drawbacks. Overdrafts aren’t allowed for certain transactions, including ACH (automatic bill pay), for example, and you can’t use the overdraft feature until you’ve made $500 worth of deposits into your account.

Similar to a cash advance app, the overdue money from your overdraft will be debited from the next paycheck that’s deposited into your account.

• Maximum amount: $200 (overdraft)
• Fees: None
• Speed: N/A
• Repayment period: Up to 60 days

4. Dave

Dave offers spending accounts and credit cards. If you open a Dave spending account, you can use it to get cash advances or two-day advances on your paycheck, with no late fees or overdraft fees. But to qualify for the highest cash advance amount of $500, you’ll need to maintain an account balance of at least $1,000 a month.

• Maximum amount: $500
• Fees: $1/mo. membership fee. Express transaction fee of $1.99 to $13.99. Tips are optional
• Speed: Just minutes for internal advances and 1-3 business days for external advances
• Repayment period: Your next payday or the Friday after your advance

5. Chime

With Chime, some customers are eligible to access their paycheck up to two days early. For those who are eligible, you’ll need to have both the cash advance and your paycheck deposited directly into a Chime account. Chime also allows overdrafts with no fees.

• Maximum amount: $200 (overdraft)
• Fees: None
• Speed: Receive cash up to two days in advance of your paycheck
• Repayment period: Your next payday

6. DailyPay

If your employer partners with DailyPay, you can take an advance on money you’ve already earned in the current pay period. In other words, you can get early access to your earned income. Whatever amount you don’t draw in advance will be deposited into your bank account on payday.

While using an app that works with your employer has its advantages, DailyPay also has fees that aren’t disclosed up-front.

• Maximum amount: 100% of the net income you’ve earned for the current pay period or up to $1.000 per day
• Fees: There’s an undisclosed fee for every transfer to your bank account, debit card or payroll card, and an undisclosed fee for instant payment.
• Speed: One business day.
• Repayment period: N/A

7. Empower

Empower offers relatively small cash advances of $10 to $250. Unlike other apps, Empower will reimburse you for any overdraft fees caused by their withdrawals from your bank account, but their subscription-based service is still more costly than most other apps.

• Maximum amount: $250
• Fees: $8/mo. subscription. Instant delivery to an external bank account costs $1-$8 . Tips are optional
• Speed: 2-5 days
• Repayment period: Your next payday

8. MoneyLion

With MoneyLion’s InstaCash, new customers take cash advances of $50. Eventually you can work your way up to being approved for $500 per transaction, but it can take as long as eight weeks to qualify for that amount. MoneyLion also offers banking services and cryptocurrency trading.

Proceed with caution, though. MoneyLion has faced multiple lawsuits related to deceiving customers. and in 2022 the Consumer Financial Protection Bureau sued MoneyLion for charging illegal fees and trapping customers in costly memberships.

• Maximum amount: $500
• Fees: None for basic cash advance services. For faster advances there’s a Turbo Fee of $0.49 to $8.99. Tips are optional
• Speed: 1-5 business days
• Repayment period: Your next payday or approximately two weeks

Pros and Cons of Cash Advance Apps Before Payday

Cash advance apps can solve the problem of how to get money fast before payday . While they may not be the most expensive option for getting an advance on your paycheck, they’re still risky.

Pros

When you don’t have other options for getting emergency money fast, cash advance apps can have a few benefits:

• Lower interest than payday loans (which average 400% APR or higher).
• Lower interest than credit card cash advances.
• May be cheaper than an overdraft fee.

Cons

Cash advance apps have major downsides. Before signing up for an app, consider the risks, including:

• You may have to pay a high APR.
• High risk of falling behind on due dates.
• Risk of overdraft or non-sufficient funds fees from your bank account.
• You may be required to open a new bank account and/or maintain a minimum deposit.
• Unpaid balances can turn into collection accounts or legal issues.

Alternatives to Cash Advance Apps

If you’re in a financial bind, it can be hard to think through all of your options clearly. But before making a quick decision to take a cash advance or a predatory loan, consider the pros and cons of the alternatives:

Small Personal Loans

A personal loan can put a lump sum of cash in your hand, without requiring you to turn over your paycheck. Unlike with cash advances, you can pay the money back over months or even years, even if it’s a small personal loan, which means you’re less likely to have a major disruption in your budget.

Buy Now, Pay Later

Buy Now Pay Later (BNPL) services give you the option to turn your purchase into a loan at checkout.

While it might be tempting to spread your payment out over several installments, BNPL can lure you into buying things you can’t really afford. That’s probably why roughly a third of BNPL users say they’ve had trouble making their payments.

Friends and Family Loans

If you have a loved one who can lend you money, it’s likely the best solution. Unlike cash advance apps, you won’t have to worry about overdrafting your bank account or paying hidden fees when you borrow money from family or friends. Plus, you can work with them to set up a repayment schedule that fits in your budget, and even draft up a simple contract that protects both parties.

How a Debt Management Plan Can Help

Everyone comes up short on cash sometimes, but using cash advances on a regular basis can indicate a deeper issue.

If you frequently find yourself wondering how to get money before payday, it might be time to seek a permanent solution, like a debt management plan (DMP) from InCharge Debt Solutions. For those who are eligible to go on a DMP, it can give them the financial relief they need to pay off debt and stop living paycheck-to-paycheck.