What are Cash Loans?

Learn more about what cash loans are and how you can get approved with Savvy.

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Savvy Editorial Team
Savvy's content writing team are professionals with a wide and diverse range of industry experience and topic knowledge. We write across a broad spectrum of finance-related topics to provide our readers with informative resources to help them learn more about a certain area or enable them to decide on which product is best for their needs with careful comparison. Meet the team behind the operation here. Visit our authors page to meet Savvy's expert writing team, committed to delivering informative and engaging content to help you make informed financial decisions.
Our authors
, updated on September 12th, 2023       

Fact checked

At Savvy, we are committed to providing accurate information. Our content undergoes a rigorous process of fact-checking before it is published. Learn more about our editorial policy.

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$50,000


Paid in 60 mins if approved*
Written by 
Savvy Editorial Team
Savvy's content writing team are professionals with a wide and diverse range of industry experience and topic knowledge. We write across a broad spectrum of finance-related topics to provide our readers with informative resources to help them learn more about a certain area or enable them to decide on which product is best for their needs with careful comparison. Meet the team behind the operation here. Visit our authors page to meet Savvy's expert writing team, committed to delivering informative and engaging content to help you make informed financial decisions.
Our authors
, updated on September 12th, 2023       

Fact checked

At Savvy, we are committed to providing accurate information. Our content undergoes a rigorous process of fact-checking before it is published. Learn more about our editorial policy.

Cash loans are a form of short-term financing solutions for consumers, a personal loan effectively that for an amount between $2,050 and $5,000 and a loan term no longer than 2 years (and no shorter than 16 days). Cash loans can be used for a variety of reasons, lenders will want to understand the purpose of the loan but what’s important to them is your ability to pay the loan down more so than the purpose. Cash is paid directly into your bank account rather than it being sent to the supplier or retail store.

That being said, there are limitations, for example, if you state that the reason is for gambling, this a prohibited reason and will end up in a decline. Cash loans need to be for a meaningful reason such as paying off bills, dental costs, medical costs, small car, school fees, small holiday, travel costs, moving costs, house bond, debt consolidation, there are many reasons. Cash loans are very flexible which is why they're so popular and used by many people Australia-wide.

Cash loans are effectively consumer loans that are legally issued by authorised lending institutions. Lending companies need to have the appropriate licensing in place in order to lend. The required license is called an Australian Credit License, this license will usually come with a 6 digit number, an example of an ACL number might be 414 565. All lenders are required to display this license number somewhere on their website. It is important to only deal with lenders that have a credit license and are displaying their number. If you cannot find one anywhere on their website then move on to the next provider.

When you transact with a licensed company it gives you peace of mind that the loan being offered to you is legal with the right terms and conditions set out by regulation. This is very important, being a credit license holder requires lenders to adhere to maximum interest rate and fee charges plus also responsible lending guidelines. This protects you from being overcharged.

Responsible lending is just as important. Responsible lending is all about the lender making sure that the funds that they are offering are not unsuitable, one of the key areas for them to assess is whether or not you can afford the loan whilst taking into consideration any existing liabilities, general living expenses and any changes to your circumstances in the future.

Short-term loans are calculated using an amortised calculation, this is the same formula that is widely used for all consumer type lending. An amortised loan is where the principle of the loan is paid down over the life of the loan (the is, amortized) according to an amotisation schedule, typically through equal payments.

Each payment to the lender will consist of a portion of interest and a portion of principle. The calculations for an amortising loan are those of an annuity using the true value of money formulas and can be done using an amortization calculator. It sounds complicated but it is quite simple in practice. What’s most important for a consumer is that the monthly repayment is known upfront, it is fixed and you are encouraged to make extra repayments if you can. There is no fee to be paid when making extra payments, any extra payments you make will come directly off of your principle amount. This will shorten your time in the loan resulting in significant interest savings. This is the case with most lenders.

Your cash loan questions are answered

What is the maximum charge on a cash loan?

The maximum charge of SACC loan is an establishment fee of $400 with an ongoing monthly fee which totals no more than 48% of your loan amount per year.

What is responsible lending?

Responsible lending is code of conduct that all lenders must adhere to when delivering cash loans to consumers in Australia.

Can I make extra repayments?

Yes, you can definitely make extra repayments on your cash loans. When you make extra repayments there is no fee to do so.

Is there any charges for discharging a cash loan early?

No, generally with most lenders no early discharge costs apply. They encourage you to pay your loan off earlier and faster. You must however read your final loan contracts before signing anything. Lenders are always open to offering you additional finance once you have successfully paid out a previous loan with them.

How are my monthly instalments paid?

Usually via direct debit either weekly, fortnightly or monthly from your selected bank account, you can establish a payment frequency before finalising your loan contracts. If you wanted to make extra payments most lenders have a BPAY facility or you can send additional payments through EFT referencing usually you loan number.

How quickly can I receive cash?

Most cash loans are quick and approved and settled, with money in your account on the same day of applying.

What is the maximum amount that I can borrow?

You can borrow from $2,050 to $5,000. Savvy also offers personal loans from its lender panel from $5,000 all the way up to $75,000.

What is required to get approved for a cash loan?

You need to complete an online application and submit some supporting documents such as 90 days worth of bank statements, 2 payslips and ID verification. You will need to be generating a consistent amount of income via either paid work or Centrelink benefits.

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Disclaimer:

The information on this website is of general nature and does not take into consideration your objectives, financial situation or needs.

For loans between $2,050 and $5,000, the APR is between 21.24% (minimum) and 48% (maximum) per annum. Comparison rate of 65.4962%. Minimum term is 16 days and maximum term is 24 months. The cost of the loan is a $400 establishment fee and monthly interest charged on the amount borrowed. For example, a loan of $3,000 over 3 months with an APR of 48%, (comparison rate of 65.4962%), will have an establishment fee of $400, monthly repayments of $1,225.20. Total repayments of $3,675.60 and total interest payment of $275.60.

Warning: A comparison rate indicates the true cost of a loan. Comparison rates are true only for the examples provided and may not include all fees and charges. Different terms, fees or loan amounts might result in a different comparison rate.