Which apps let you borrow money
The most common money-borrowing apps fall into a few categories: paycheck advance apps that let you access a portion of your next paycheck early, personal loan apps that lend you a lump sum you repay over weeks or months, and buy-now-pay-later apps that split a purchase into installments. The names you will encounter most often are Earnin, Dave, Brigit, MoneyLion, and Chime for paycheck advances; Upstart, LendingClub, and OppFi for personal loans; and Affirm, Klarna, and Afterpay for buy-now-pay-later.
Each app works differently. Paycheck advance apps connect to your bank account and employer payroll system to verify your income, then let you borrow against earnings you have already worked for but have not yet received. Personal loan apps use your credit history, income, and sometimes alternative data (like bank transaction patterns) to decide whether to lend you a larger amount. Buy-now-pay-later apps are tied to specific purchases and split the cost into installments, usually without a credit check at the point of sale.
The cost structure varies sharply. Some paycheck advance apps charge nothing if you repay on time; others charge a flat fee or ask for a voluntary tip. Personal loan apps charge interest rates that depend on your credit score and the lender's underwriting. Buy-now-pay-later apps may charge no interest if you pay on schedule, but charge late fees or interest if you miss a payment.
Key Takeaways
- Paycheck advance apps let you borrow against your next paycheck with little or no interest, but the amount is capped at a portion of your next deposit.
- Personal loan apps lend larger amounts but charge interest rates ranging from roughly 6% to 36% depending on your credit score and the lender.
- Buy-now-pay-later apps split purchases into installments with no interest if you pay on time, but charge late fees if you miss a payment.
- All three types require you to connect a bank account, and most require proof of income or a credit check before you can borrow.
- The cost of borrowing can vary by hundreds of dollars depending on the app, the amount, and how quickly you repay.
How paycheck advance apps work and what they cost
Paycheck advance apps are designed to bridge the gap between now and your next paycheck. You connect your bank account and give the app permission to see your payroll deposits. The app then lets you borrow a portion of your next paycheck—usually between $100 and $500, though some allow up to $1,000. You repay the advance when your paycheck hits your account, typically within a few days to two weeks.
The cost depends on the app. Earnin, for example, charges nothing if you repay on time but asks users to leave a voluntary tip (the app suggests amounts like $1, $2, or $5). Dave charges a monthly subscription fee of around $1 per month for basic access, with optional paid tiers. Brigit charges a monthly subscription of roughly $9.99 for access to advances. MoneyLion offers advances through its premium membership, which costs around $20 per month but includes other features like investment tools.
The real cost is what happens if you miss the repayment date. If your paycheck is delayed or you do not have enough in your account when the app tries to withdraw, you may face overdraft fees from your bank, late fees from the app, or both. Some apps will retry the withdrawal multiple times, multiplying the damage. Before you use one, check whether the app offers a grace period or the ability to reschedule the repayment.
How personal loan apps work and what they cost
Personal loan apps lend you a larger amount—typically $500 to $10,000—that you repay over a set schedule, usually 12 to 60 months. The app checks your credit score, income, and sometimes other factors to decide whether to lend to you and at what interest rate. Interest rates on these loans range widely, from around 6% to 36% depending on your credit score and the lender's risk assessment.
Upstart and LendingClub are among the largest. Upstart uses machine learning to assess borrowers and may approve people with limited credit history. LendingClub is a peer-to-peer lender that has been operating since 2006 and tends to serve borrowers with fair to good credit. OppFi focuses on borrowers with lower credit scores and offers smaller loans with shorter repayment terms, but at higher interest rates.
The cost of a personal loan depends on the interest rate and the loan term. A $3,000 loan at 12% interest over 36 months costs roughly $1,900 in interest. The same loan at 30% interest costs roughly $4,700 in interest. Before you borrow, use the app's loan calculator to see the total cost, including all interest and fees. Some apps charge origination fees (a percentage of the loan amount, usually 1% to 6%) that are deducted from what you receive.
How buy-now-pay-later apps work and what they cost
Buy-now-pay-later (BNPL) apps let you split a purchase into installments, usually four equal payments spread over six to eight weeks. You choose the app at checkout, enter your payment information, and the app pays the merchant immediately. You then repay the app in installments, often with no interest if you pay on time.
Affirm, Klarna, and Afterpay are the largest BNPL providers. Affirm shows you the interest rate (if any) before you complete the purchase, so you know the total cost upfront. Klarna offers interest-free installments for most purchases but charges interest on longer payment plans. Afterpay charges no interest but charges a late fee if you miss a payment, usually $8 or more.
The main cost is the late fee. If you miss even one installment, you will owe a fee on top of the amount due. Some apps also charge a fee if a payment fails due to insufficient funds. Unlike personal loans, BNPL apps do not report on-time payments to credit bureaus, so using them responsibly does not build your credit. However, missed payments may be reported and can hurt your score.
Comparing the three types side by side
| Type | Loan Amount | Repayment Term | Interest Rate or Cost | Best For |
|---|---|---|---|---|
| Paycheck Advance | $100–$1,000 | A few days to 2 weeks | $0–$15 (or voluntary tip) | Short-term gaps between paychecks |
| Personal Loan | $500–$10,000+ | 12–60 months | 6%–36% annual interest | Larger expenses, longer repayment ability |
| Buy-Now-Pay-Later | Varies by merchant | 6–8 weeks (usually) | $0 (if on time) or late fees | Splitting specific purchases into installments |
What to check before you download a borrowing app
Before you use any borrowing app, verify that it is legitimate and understand what data it will access. All reputable apps will ask for permission to view your bank account and payroll information. Check the app's privacy policy to see how long it keeps your data and whether it sells information to third parties. Look for apps that are registered with the Consumer Financial Protection Bureau (CFPB) or state financial regulators.
Read the terms carefully, especially the section on late fees and what happens if you cannot repay on time. Some apps will retry a failed withdrawal multiple times, each triggering a bank overdraft fee. Others offer a grace period or the option to reschedule. Check whether the app reports to credit bureaus—paycheck advance apps typically do not, but personal loan apps do, so missed payments can damage your credit.
Compare the total cost across apps. Two paycheck advance apps may charge very different amounts for the same $300 advance. Two personal loan apps may offer different interest rates based on your credit score. Use the app's calculator or contact customer service to get a clear picture of what you will owe, including all fees and interest.
When borrowing from an app makes sense and when it does not
Borrowing from an app makes sense when you have a specific, short-term need and a clear plan to repay. If you are one week away from your paycheck and need $200 for groceries, a paycheck advance app with no fee or a small tip is cheaper than a payday loan or credit card cash advance. If you have a larger expense—a car repair, medical bill, or home improvement—and can afford monthly payments, a personal loan app with a reasonable interest rate may be cheaper than a credit card.
Borrowing from an app does not make sense if you are borrowing to cover a recurring shortfall in your budget. If you need an advance every month because your expenses exceed your income, the real problem is not access to credit—it is that you are spending more than you earn. Using apps repeatedly will cost you hundreds or thousands in fees and interest and will not solve the underlying problem. In that case, the better move is to cut expenses, increase income, or both.
It also does not make sense if you do not have a clear repayment plan. If you borrow $500 and do not know when you will have $500 to repay, you will likely miss the deadline, face fees, and end up owing more. Before you borrow, make sure you have a specific source of money to repay—a paycheck, a tax refund, a bonus, or a planned sale of something you own.
Frequently Asked Questions
Do borrowing apps check your credit score?
Paycheck advance apps typically do not check your credit score; they check your income and bank account instead. Personal loan apps almost always check your credit score and may do a hard inquiry, which can temporarily lower your score by a few points. Buy-now-pay-later apps usually do a soft check at the point of sale, which does not affect your score, but may do a hard check if you miss payments.
What happens if I cannot repay on time?
The consequences depend on the app. Paycheck advance apps may retry the withdrawal multiple times, triggering overdraft fees from your bank. Personal loan apps may charge a late fee and report the missed payment to credit bureaus, damaging your credit score. Buy-now-pay-later apps charge late fees and may report to credit bureaus. Before you borrow, ask the app what grace period or rescheduling options are available.
Can I use multiple borrowing apps at the same time?
Technically yes, but it is risky. If you borrow from multiple apps and cannot repay them all on time, you will face multiple sets of fees and potential credit damage. Some apps check whether you have other outstanding advances before approving you. The safest approach is to borrow from only one app at a time and repay it fully before taking on another.
Are borrowing apps safer than payday loans?
Many are, but not all. Reputable borrowing apps are regulated by state financial authorities and the CFPB, and they disclose their fees and interest rates upfront. Payday loans are also regulated but often charge much higher interest rates (sometimes 400% or more annually). However, some borrowing apps are less transparent or charge fees that add up quickly. Always compare the total cost and read the terms before you choose.
Will using a borrowing app build my credit score?
Paycheck advance apps typically do not report to credit bureaus, so they do not build credit. Personal loan apps do report, so on-time payments can help your credit score over time. Buy-now-pay-later apps usually do not report on-time payments but may report missed payments. If building credit is a goal, a personal loan app with on-time repayment is the better choice.