What Are Different Ways to Borrow Money?

When you need extra money, there are lots of ways to borrow—but they’re not all equal in cost or risk.

The right option depends on how much you need, how fast, and how long you’ll take to pay it back.

Quick, Short-Term Help: KOHO Cash Advance

If you’re just trying to bridge a short gap until payday, you don’t necessarily need a full loan or new credit card.

With KOHO Cover, you can:

• Get up to $250 as an instant cash advance (amount depends on eligibility)

• Pay no interest on the advance

• Avoid a credit check

• Repay automatically once you add money or get paid

You subscribe to the Cover bundle for a low monthly fee, and in return you get extras like a credit report, financial coaching, and priority support.

Other Common Ways to Borrow Money

1. Credit Cards

What it is: A revolving credit line you can use for purchases or sometimes cash advances.

Pros:

• Widely accepted

• Useful for everyday spending and online purchases

Cons:

• High interest if you don’t pay in full

• Easy to overspend and carry a balance

2. Personal Line of Credit

What it is: A reusable pool of credit you can draw from, repay, and reuse.

Pros:

• Flexible access to funds

• Often a lower rate than credit cards

Cons:

• Still easy to slowly build up a large balance

• Requires discipline and a plan to pay it down

3. Personal Loans

What it is: A fixed amount of money you borrow once and repay in set installments.

Pros:

• Clear payment schedule

• Fixed end date

Cons:

• Less flexible than a line of credit

• You pay interest on the full amount, even if you didn’t need it all

4. Overdraft and Bank Account-Based Borrowing

What it is: Your account is allowed to go negative up to a certain limit.

Pros:

• Automatic coverage for small gaps

• Can prevent bounced payments or NSF fees

Cons:

• Fees and interest can add up fast

• Easy to treat as extra money instead of last resort protection

5. Buy Now, Pay Later (BNPL)

What it is: Splitting a purchase into installments (often bi-weekly or monthly).

Pros:

• Small payments over time

• Sometimes low or no interest if repaid on schedule

Cons:

• Easy to stack multiple plans and lose track

• Missed payments can mean fees or impact your credit

Safer if you keep it to one or two purchases and know your budget.

6. Payday Loans and High Cost Short-Term Loans

What it is: Very short-term loans with high fees or interest.

Pros:

• Fast access, even with weak credit

Cons:

• Extremely expensive

• Easy to get trapped in a cycle of borrowing to pay back previous loans

7. Borrowing From Friends or Family

What it is: Informal loans from people you know.

Pros:

• Low or no interest

• Flexible terms

Cons:

• Can strain relationships if expectations aren’t clear

• Easy to under-communicate or delay repayment

If you do this, it helps to agree on amount, timing, and repayment upfront.

Choosing the Right Way to Borrow

In general:

• Use smaller, short-term tools (like KOHO Cash Advance) for tiny gaps and surprise bills.

• Use more structured products (like personal loans or lines of credit) for larger needs with a clear payback plan.

• Avoid high cost options like payday loans whenever you can.

And if you find yourself borrowing often, that’s your signal to rework your budget, build a small buffer, and look for tools that help you manage cash flow, not just add more debt.