Non-Bank Personal Loans

Look past the big banks and find the best personal finance deal for you by comparing with Savvy today.

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, updated on October 4th, 2023       

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What are non-bank lenders and how do they work?

A non-bank lender is a type of lender outside of traditional banks, credit unions and building societies, who are all Authorised Deposit-Taking Institutions (ADIs). There are several different lenders that can fall under this category, which include:

Online lenders

Online (or direct) lenders are privately owned and operated, and are often more specialised in terms of the products that they offer: some offer personal loans and little or nothing else, as opposed to the suite of products that a bank can offer.

Where they differ most, though, is their more inclusive lending criteria. These are often one of the only options, if not the only option, available to borrowers with bad credit or who don’t meet traditional lending criteria relating to their income documentation (such as self-employed workers).

While these particular products come with higher fees and rates, online lenders’ products are also generally offered at a lower overall cost than those of banks. This alone could save you hundreds or thousands of dollars over your loan term.

You can compare some of the best and most affordable non-bank personal loans from our panel of online lenders right here with Savvy. Contrast loans based on their interest rates, fees, loan terms and borrowing amounts to help you save more on your personal financing.

Peer-to-peer lenders

New to our shores, peer-to-peer (P2P) finance is the one of the most unique types of lending in Australia. Unlike standard lending applications that are submitted online to a particular financier, P2P lending involves submitting your application to a specialised website to enable its review by individual investors or firms who can anonymously approve your application.

The same general checks are still conducted with these loans, but they are also lenient in terms of their criteria, enabling bad credit customers to pursue them as an option. It’s important to note that P2P lending host sites are designed to get deals done, so you can experience a fast turnaround on your application.

Additionally, P2P are amongst the best non-bank personal loan options on the market when it comes to lower rates and fees that they charge on personal loans, meaning they can be another cheap option for your personal finance needs.

How do I compare the best non-bank personal loans in Australia?

Frequently asked questions about non-bank lenders

Can I pay my personal loan off early with a non-bank lender?

Yes – most online lenders will enable you to pay above the minimum required monthly payment without incurring an extra cost, as well as completing your loan repayments early and free of charge. This can save you plenty of money overall on your loan, so you should compare lenders who allow you to do so.

What are some common features on non-bank personal loans in Australia?

Personal loans can come with added features like flexible repayments either monthly, fortnightly or weekly and redraw facilities to gain access to additional repayments made previously. These should also factor into your thinking when deciding upon which personal loan is right for you. 

Do non-bank lenders have branch access?

Usually not – online and P2P lending function primarily in the digital space and save on overheads related to running branches as a result. If in-branch access is important to you, a bank or credit union may be a better option for your financing needs.

Can I get 24-hour support with a non-bank lender in Australia?

You’re unlikely to receive as extensive a customer support network with a non-bank lender as you would with a bank. This is because they’re smaller entities; banks have far greater resources to manage things like around the clock customer service. You may be able to find a non-bank lender who offers thorough customer service, but 24 hours may not be achievable.

Is it safe to use a non-bank lender?

Yes – all non-bank lenders are regulated by ASIC, so they’re safe to use. This means that they’re required to act responsibly and in your best interests whenever conducting themselves.

How long will it take to be approved for a personal loan?

Personal loans are a highly automated process that can come with instant outcomes within 60 seconds and have money transferred to your account in 24 hours if your application is successful.

Helpful personal loan guides