However, payday loans come at exorbitant costs. This can -- and often does -- lead borrowers into a downward spiral of rapidly escalating debt. Let's look at issue from various angles to get a complete picture.

First, pluses. Here's why cash advances may hold enormous appeal for you.

You can have bad credit and still qualify for a payday loan. In most cases, no credit check is conducted. The process is fast -- it can take as little as 20 minutes to complete. Some lender even claim to target approvals in 30 seconds!

There are no upfront costs -- so buy-now-pay-later convenience applies here as well. You can apply in person at a local outlet, over phone or over Internet. You get funds deposited into your bank account in 24 hours.

Compared to some other sources for cash, payday loans are discreet -- no one else needs to know about it. The transactions are secure -- your financial information remains private.

If you're faced with an emergency -- say, unexpected medical bills -- your only consideration might be to get money now. The speed and convenience of a cash advance comes in handy here.

So what are disadvantages?

The most obvious one -- high costs. A payday loan can cost you say, $15 per two weeks. If you're borrowing only for two weeks, that doesn't sound like much. However, if you calculate Annual Percentage Rate (APR), you'll see it comes to 391%!

If you don't think that's too much, let me ask you this question. If you invested money in stock market, what would you consider a good annual rate of return? 20%? Maybe 30%? If you made a 20% return (on average) in stocks year after year, you'd be doing very well indeed. And this is for an investment that's generally considered high risk.

Now compare that with what payday loan companies charge. You are providing them with a return on their money they won't get in too many other avenues.

There is another, less obvious reason why payday loans are dangerous. According to some estimates, over 60% of borrowers roll over a payday loan. Many take loans repeatedly, too.

Sounds like a good deal for customers, right? That's what banks say. They claim overdrafts are an added convenience to customers.

The truth is, they're often a very bad deal for customers. Here's why.

When a bank grants a regular line of credit, interest charged may be up to say, 20% or so. However, for overdrafts, banks don't charge interest -- they charge a flat fee on each transaction. A fee that does not depend on value of transaction.

Let's see how that works. Overdraft plans fees may be as high as $35 per check. We'll assume a more conservative fee of $20 per check. If you have four checks totaling $200 that have insufficient funds against them and bank automatically activates overdraft and clears those checks, you will owe $80 in overdraft charges.

Unlike revolving lines of credit which you can repay at your convenience, an overdraft has to be settled in just a few days. Let's say bank allows you to run overdraft for 14 days.