Unemployment may have been a local concern for some states, but after the pandemic, it became a global one. Now in 2022, the global unemployment rates are at a staggering 5.9%. In such a distraught state, many may find it infeasible to cover their daily expenses. Taking loans would also not be possible because of no proof of income.
However, due to an increasing unemployment rate, there is fear that society might fall into debt. To resolve this, Canada now offers payday loans even to the unemployed. Payday loans for unemployed and on-benefit individuals are designed to help them get back on their feet. They are a source of emergency cash and are easy to apply for.
What Are Payday Loans?
If you are in need of immediate cash, then payday loans are for you. They are short-term loans with the payment due date ranging between two weeks to your payday. Payday loans offer high-interest credit based on your income, so it would not be wise to get stuck in this cycle. However, they do fulfill the need for a one-time emergency loan, letting you get your bearings and become financially stable. In this case, the lender receives a post-dated check or authorization to your electronic debit. If you fall behind in paying back the amount, they may cash the check or electronically withdraw money from your account.
Payday loans are becoming very popular due to the simplicity of their application and the swift approval process. Conventionally, getting a cash loan has been a lengthy affair involving visits to the bank to get your application approved. On the other hand, payday loans are online and offer easy and fast approval. Secondly, your credit score does not matter, making the loans convenient and flexible.
Payday Loans for the Unemployed
Canada is now offering payday loans to the unemployed and to people on benefits. Instead of using your salary as a source of income, they use Employment Insurance. This is government-run support for the unemployed where you receive money that was kept apart from your wages while you were employed. It is just like a piggy bank but operated by the government.
Employment insurance is a temporary support program aimed at unemployed individuals to help them get back on their feet. If you are unemployed and receive an EI, you qualify for the eligibility criteria for obtaining a payday loan. The amount may range from $500 to a maximum of $1500.
You don’t have to worry about having a bad credit score either. In the case of payday loans, your credit score does not matter. However, it may be used to validate your identity, living conditions, employment status, and income.
These days, it is not impossible to get a loan when you’re unemployed. Through this program initiated by the government, jobless individuals can apply for payday loans using their employment insurance plan as a source of income. The eligibility criteria differ for the employed and unemployed, and this difference enables the latter to avail financial support they need to open that small business of theirs or get through the month while searching for a job.