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Bad things happen, and often to good people. Cars get stuck in ditches, kids get hurt on playgrounds, and layoffs or illness significantly impact cash flow. When credit union members need money fast, they’ve got a few quick loan options that may help them maintain solvency.
Credit union members in need of quick loans have a few options, each with varying levels of efficacy.
- Ask a friend or family member.
- This option is risky for a whole new set of reasons than the other on the list. Loans from friends and family work best when a card is declined or a wallet is forgotten when going out for dinner or drinks.
- Payday lending center.
- Payday loans are often predatory and lead to cycles of debt, which may exacerbate the underlying causes of the problem. Predatory lenders should be avoided at all costs, but they may be necessary for people who don’t qualify for deposit accounts.
- Online quick click loans.
- Quick click loans through services like Lending Tree or NetCredit use sophisticated software that can underwrite and approve loans almost instantly. Some of these services can fund accounts as quickly as 24–72 hours.
- QCash payday alternative lending program.
- Credit unions who partner with QCash can offer their members quick, small-dollar loans through their credit union’s online banking portal. QCash also uses sophisticated software that can underwrite, approve, and fund loans within 60 seconds.
While any of the above options can work, only a few of them are sound decisions that have minimal long-lasting ramifications. Similarly, most of the above options take a good amount of time to approve and fund.
Time is of the Essence
Preparing necessary documents and paperwork is one part of the time cost associated with applying for a quick loan. The other half comes from waiting for funding, which, even with some of the fastest options out there, can take hours. More often, it takes a day or more to get funding. Members in need of quick loans—truly quick loans—may not have several days to wait for funding.
Some emergencies don’t give people the option of waiting hours or days for loan approval and funding. For example, if a credit union member has to be at work across town at 8am, but their car was towed and stored, they may not have the luxury of waiting 24 hours for loan funding.
To retrieve their car, they would need money to cover both the towing and storage costs. If they can’t produce the required sum immediately, they run the risk of being late or not showing up to work, which puts their job and income in jeopardy, further impacting their financial health.
We don’t mean to introduce slippery slope examples, though. We just want to illustrate that many situations call for immediate monetary relief to avoid spiraling further into insolvency.
A quick loan from their credit union would significantly help the member with their towed car. Credit unions who don’t offer quick loans, or those who can’t immediately fund approved quick loans, are not providing a unilaterally useful service to their members.
Faster than the Flash
Offering quick loans can help the credit union’s most vulnerable members in crises. By providing a fast, efficient, and necessary small-dollar loan service, credit unions can offer a safety net to their members who don’t have their own emergency funds set aside.
Services that integrate with credit unions (like QCash) can quickly analyze a member’s entire set of financial data to assess loan risk and member ability to repay. From there, they can immediately deposit funds into their account for immediate access.
A Simple Five-Step Process for Quick Loans
Quick loans through QCash take 60 seconds from application to approval and funding.
The process is easy. All a member has to do to take out a small-dollar loan is:
- Open their mobile banking application.
- Enter the QCash interface.
- Answer a few initial questions.
- Read and sign disclosures.
- Access their loan money instantly from their credit union deposit account.
All in all, it takes six clicks over 60 seconds.
Keeping Your Credit Union Members Financially Viable
Small-dollar loan programs are a safety net for certain member segments. Reaching these communities is key to responsible short-term loan deployment strategies.
If you’d like to learn more about how quick loans can increase your credit union’s margin while protecting its most vulnerable members, follow the links below. Or, if you’d like to see what other steps you can take to help your members through trying financial times, download our Member Crisis Guide.
- What Level of Staffing Do I Need for My Credit Union Small-Dollar Loan Program?
- Overcoming Potential PR Issues from Credit Union Small-Dollar Loan Programs
- The Member Segments Most Affected by Credit Union Small-Dollar Loan Programs
- Measuring the Success of Your Credit Union’s Small-Dollar Loan Program
- Best Practices for Marketing a Credit Union Small-Dollar Loan Program