Cash Now Pay Later: What is it and How Does it Work?

  • January 16, 2023
  • 4:40 minutes

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Online money lending in the UAE is not new nowadays when you can instantly get small loans in one hour or less. Online money lending services come to your rescue when you need money, be it for financial emergencies or for meeting personal needs.

Cash now pay later is one such method of obtaining money instantly without lengthy documentation and faster approvals. Let’s deep dive into cash now pay later service and understand why you may need it.

What is Cash Now Pay Later?

Cash now, pay later is a type of borrowing money online that offers small loans and simplified documentation procedures. Your application may get rejected due to rigid rules and terms when you borrow money from traditional players.

Whereas in cash now, pay later, you get faster approval for your loan application and get instant access to the cash, which is the primary requirement in times of financial emergencies.

Remember: Always borrow money from authorized lenders in the UAE. Money borrowed from unauthorized parties is illegal in UAE.

How Does Cash Now Pay Later Work?

Cash now pay later allows you to borrow money for your immediate use, such as meeting personal expenses, financial emergencies, paying a huge hospital bill, etc. Many online money lenders allow you to borrow money at zero or low interest rates to repay the money in equal installments.

For example, buy now pay later is a money lending scheme offered by a financial service provider to allow customers to shop for items they want to buy and pay the money back later in equal installments without interest.

The interest rate and the duration of the pay-later schemes depend on the borrowers’ requirements and the lenders’ specifications. While some lenders charge zero interest, some charge minimal interest for the amount lent. 

Key Features of the Cash Now Pay Later

Online money lenders are many, but only recognized ones can lend you money legally. Thus, you need to first check the authenticity of the lender before you opt for the cash now pay later scheme.

One of the primary reasons why cash now pay later is quite popular among Millennials and Gen Z is its faster approval process. Let’s look at the key features of the cash now pay later in detail.

Instant Disbursal

Cash now pay later schemes allow you to instantly access the cash you requested for. The online money lenders will quickly disburse the money to your digital wallet once the application is approved.

Although cash now pay later uses minimal background checks, it does go through the applicant’s history and a basic KYC check.

Faster Approval

The reason why cash now pay later schemes can approve loans faster is that they use latest technologies to check KYC documents and the credit history of the borrower.

For example, using open APIs (application programming interfaces) lenders can instantly get the credit score of the applicant by simply entering the basic information about the applicant.

Thus, technologies like APIs, artificial intelligence (AI), machine learning (ML), internet of things (IoT) have paved the way to offering simplified solutions be they financial or non-financial solutions.

Cost-effectiveness

There are many reasons why cash now pay later is a cost-effective solution. Let’s see what are those:

  • Use of the technologies makes it a cheaper solution since the majority of the work is done digitally.
  • Infrastructure costs are saved since these are online money lending providers and thus, the benefit of the cost saved is passed on to the consumers.
  • Loan processing methods are fully automated and hence, the maintenance costs are saved which makes it budget-friendly.

Minimal Documentation

Since the open APIs are used to carry out the KYC and credit history checks, the human efforts are minimized and that reduces the physical documentation procedures. When the documentation is simplified, more customers are likely to avail of the services.

Moreover, minimal documentation doesn’t mean your KYC is not checked. Instead, the service providers use technologies to quickly complete the documentation digitally.

Maintaining a Positive Cashflow

Cash now pay later is quite an effective way to maintain your cash flow positive. For small businesses, it is pretty crucial to maintain a positive cash flow, especially in the beginning.

Cash now pay later helps start-up owners maintain their working capital liquidity and have a positive cash flow even if the revenue generation is lower in the initial years.

Meets Financial Emergencies

The very purpose of availing the cash now pay later scheme is to meet financial emergencies such as urgent medical expenses, or huge equipment costs. Cash now pay later can instantly provide you with the cash to meet your financial obligations in emergencies.

Is Cash Now, Pay Later a Type of a Loan?

Yes, cash now pay later is a loan that is offered online with faster loan approval processes and disbursals. However, unlike traditional loans, the cash now pay later does not require a cumbersome documentation procedure. It is instead, done using automated processes using the latest technologies.

Alternative Solution to Cash Now Pay Later

If you don’t want to obtain a loan or are looking for alternate solutions to cash now pay later, check out these options that might help you simply access the cash without actually obtaining a loan.

Money on Demand: Money on Demand’ is an instant cash solution provided by Payit mobile wallet app to meet your financial needs. Eligible ratibi cardholders can access instant money through the ‘Money on Demand’ feature on the app.

Read more about Payit’s ‘Money on Demand’ service on Unlocking Money on Demand Feature Through Ratibi Salary Cards.

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