How to judge any short-term cash offer

If you drive for a living, someone will offer you money. A cousin who knows a guy. A WhatsApp message from a number you do not know. An app with a bright button that says 'Get cash now'. When the tank is low and the rent is due, it is very hard to slow down and read the fine print.

I want to give you a simple way to judge any short-term cash offer, including ours. It takes five minutes. Your earnings are worth that five minutes.

Let me be clear about one thing first. Borrowing money costs money. Anyone lending to you is taking a risk and has to cover it. So the question is never 'does this cost something?' The question is 'do I know exactly what it costs, and can I pay it back without it growing?'

1. Ask what it costs, in rands

Not a percentage. Not 'from as little as'. A number in rands. If you borrow this amount, what is the total you pay back?

A fair offer can answer that in one sentence before you say yes. If the person or the app cannot tell you the total, or the answer changes depending on things they will not explain, that is your first warning.

Here is how we answer it for Detour Capital. On Professional Driver, you take R1 000 and you pay back R1 270. That is the R1 000, plus R120 interest and fees, plus the R150 subscription. On-The-Go is R500, paid back as R720. MyOwnBoss is R2 500, paid back as R2 870. No admin fee, and nothing added later.

2. Ask how long it runs

Time is where cheap money becomes expensive. A loan that runs for months gives the cost months to build. A loan that can be 'rolled over' when you cannot pay gives the cost a reason to start again.

Look for a short, fixed term with a clear end. Detour Capital runs for one week. You pay it back in one go, and it is finished. There is no option to stretch it over four or six weeks, and that is on purpose.

3. Ask how it is collected

This is the question most drivers forget, and it matters as much as the price.

• Does it come off your earnings, or is it a debit order on your bank account?
• When does it come off? Does that match when you actually get paid?
• What happens if the money is not there that day? Is there a penalty? Does it bounce and cost you a bank fee as well?

A debit order that runs before your money lands is how a small loan turns into bank charges, penalties and a call from a collector. Repayment that comes off the earnings that pay for it is much harder to miss.

Detour Capital is paid back from your next week's Uber earnings, in one payment. There is no debit order on your bank account. If your earnings that week will not cover it, we contact you first.

4. Ask who is lending, and read what you sign

In South Africa, a lender has to be a registered credit provider, and you have a right to see the cost and the agreement before you accept. Anyone who will not show you that, or who wants your bank card and PIN 'to make it easier', is not someone to borrow from.

Detour Capital comes from a registered credit provider. Each request is assessed, so approval is not guaranteed. Before you accept, you get a quotation and a credit agreement. Read them. If something is unclear, ask us before you say yes.

The mistakes I see most

• Thinking every cash app works the same way. They do not. Some state the cost up front. Some bury it.
• Comparing the advert instead of the total. 'No fees' on the front page means nothing if the total you pay back is higher.
• Ignoring the date. A cheaper loan that runs for three months can cost you far more than a dearer one that ends next week.
• Borrowing what you cannot pay back next week. If next week's earnings will not cover it, borrowing makes next week harder, not easier.

What to do with this

Next time someone offers you cash, ask the four questions. What is the total in rands? When does it end? How is it collected? Who is lending, and can I read the agreement first? If you get four clear answers, you can make a real decision. If you do not, walk away.

That goes for Detour too. Hold us to the same questions. That is why the answers are written on our page before you ask for a cent.