An online cash advance refers to a short-term loan. Most short-term loans are payday loans, although there are other options if you want a cash advance. The term cash advance also refers to cash you can withdraw from your credit card. However, the focus of this guide is online cash advance loans.
Are you struggling financially?
If you're struggling financially and would like to speak to someone for free financial advice, information and assistance you can call the Financial Counsellors hotline on 1800 007 007 (open from 9:30am to 4pm, Monday to Friday). If you are suffering financial problems related to the coronavirus pandemic you may be eligible for additional support.
⚠️ Warning about Borrowing
Do you really need a loan today?*
It can be expensive to borrow small amounts of money and borrowing may not solve your money problems.
Check your options before you borrow:
- For information about other options for managing bills and debts, ring 1800 007 007 from anywhere in Australia to talk to a free and independent financial counsellor
- Talk to your electricity, gas, phone or water provider to see if you can work out a payment plan
- If you are on government benefits, ask if you can receive an advance from Centrelink: Phone: 13 17 94
The Government's MoneySmart website shows you how small amount loans work and suggests other options that may help you.
* This statement is an Australian Government requirement under the National Consumer Credit Protection Act 2009.
What is an online cash advance loan?
If you want a small sum of money ahead of payday, you could consider an online cash advance loan. These loans are typically small and designed to be paid within a short period of time. The most common of these is a payday loan.
With cash advance loans, you can expect fast turnaround times and quick applications, but keep in mind that fees will be charged. In some cases, as with payday loans, the fees are generally high, making the loan an expensive option.
These loans are not designed for long-term financial use. If you’re looking for a long-term financial solution, there are more suitable loans to consider. Given how costly these loans are, they should also be used only in emergency situations.
Comparison of online cash advances
What kind of online cash advance loans are available?
There are a number of options available. The best option for you will depend on your individual circumstances and what you can afford.
- Overdrafts. An overdraft facility can be set up with your current bank and linked to your existing transaction account. This facility allows you to overdraw your account up to the given limit. This limit will be agreed upon by the applicant and the bank, and will depend on the financial position of the borrower. Some banks offer overdraft facilities in excess of $25,000. With overdrafts, you only have to pay for what you borrow. Interest charges will apply. If you have a good relationship with your bank, you may be able to get an overdraft even if your credit isn’t perfect.
- Payday loans. Payday loans are small loans with short repayment periods. Usually the loan term is 16 days to 1 year. These loans are typically expensive, and come with high fees and charges. Ideally you should only apply for one in financial emergencies. You can get payday loans up to $2,000, although there are medium term loans for $5,000 and $10,000. Most $2,000 loans come with an establishment fee of 20% of the loan amount and a monthly fee of 4%. Bad credit options are also available.
- Centrelink cash advance. If you receive Centrelink payments, you may be able to bring it forward as a cash advance. This is not an additional payment, but an advance on your existing payments. You may be eligible depending on how long you have been with Centrelink and how much you receive.
- Pay on demand. This is a type of short-term loan. With it, you can borrow a portion of your pay cheque before your actual payday. It’s offered by banks, pay-on-demand apps such as Beforepay, and services such as InstaPay which are offered by employers. Some banks have their own pay-on-demand apps too.
How much do online cash advance loans cost?
When you’re taking out an online cash advance loan, you’re often paying for the cost of convenience. Here’s an outline of what it will cost you:
- Overdraft. You can expect to pay between 10% to 20% for an overdraft. You may also have ongoing fees. Rates will vary based on the lender.
- Payday loan. For a short-term loan under $2,000, you can be charged up to 20% in establishment fees and 4% monthly fees. For a medium loan from $2,001 up to $5,000, the application fee will be $400 and the interest rate will be 48% p.a.
- Centrelink cash advance. The advance will be deducted incrementally from your future payments.
- Pay on demand. Fees range from $2 to $10 dollars, or in some cases 5% of the amount borrowed.
How can I compare online cash advance loans?
When comparing loans and lenders, here’s what you need to keep in mind:
- Interest rates, fees and affordability. It’s important to calculate the cost of the loan and work out whether you can afford it. The cost of borrowing may include interest charges and additional fees. Keep an eye out for what your monthly repayments will be. Only apply for the loan if it fits comfortably in your budget.
- Applications and turnaround time. Most lenders now have online applications. Keep an eye out for their application processing time and how long it will take for you to receive the money. The important thing to consider is whether you’ll receive the money when you need it.
- Loan amounts. The loan amount should be enough to service your needs. It’s advisable to borrow just how much you need and nothing more. By borrowing more money that you need, you’ll be paying interest on money you don’t want.
- Loan term. This is how long you have to repay the loan. Most cash advance loans have short terms. You’ll have to consider whether you can repay the loan within the given time. Also consider whether you can do so without adding strain to your budget.
- Added features. Can you repay the loan early or make additional repayments?
- Eligibility. Every lender has their criteria. You should ensure you tick all the boxes before applying. If you don’t meet their criteria, your application is likely to get rejected.
What should I keep in mind when applying for an online cash advance loan?
- High fees and charges. Affordability is key. If you can’t afford the loan, you shouldn’t apply. Apart from risking financial problems, lenders are also obliged to consider whether you can repay the loan. If they feel you can’t, you will be rejected. High fees and charges are especially a problem with payday loans. Fees are regulated by ASIC and it's illegal for lenders to charge more. You should ensure you can repay the loan with ease before applying.
- Disreputable lenders. Check the lender's website and make sure it's a reputable company. You should ensure it is registered with ASIC. It should also be easy to contact. Watch out for loans that seem too good to be true. There are predatory lenders seeking to take advantage of desperate borrowers.
- Long-term repercussions and legal issues. Once you sign a loan agreement, you are bound to its conditions. You will have to pay the loan, and all the fees and payments. Most of these loans are unsecured. This means the lender can initiate legal proceedings against you if you do not repay the loan. It can also report the debt to a credit reporting body like Equifax and use the services of a debt collector.
- Multiple applications. Every loan application shows up on credit reports. Some short term lenders may not consider your credit history. But several applications within a short period can have a negative impact on your credit score. This can make it harder for you to get a loan in the future.
- More debt. Given how expensive some of these loans are, they could potentially lead to more debt if you can’t meet your repayments. Late or non-repayments could lead to more fees, which has the potential to spiral out of control.
Cash advance speeds by brand
|Brand||When you receive your cash||What do you need to do?||How much can you apply for?||More details|
|Cash Train||Same day||Loan needs to be approved by 2pm||$200 - $2,000||More|
|Credit24||Same day||Loan needs to be approved by 3pm||$500 to $2,000||More|
|enably||One hour||Approval takes one hour and you'll be transferred funds minutes after. CommBank customers receive in minutes, others may take longer.|| - |
|MoneyMe||One hour||Approval and funds transfer takes on hour. Receiving funds depends on bank processing times.||$500 - $50,000||More|
|MoneySpot||One hour||You can receive your funds within minutes of being approved if you bank with CommBank, other banks take one hour.||$200 to $2,000||More|
|Nimble||One hour||Loan must be confirmed before 4:30pm to receive within the hour.||$300 - $5,000||More|
|Sunshine Loans||One hour||Loan needs to be approved within business hours to receive it within the hour.||$2,050 - $2,500||More|
|Swoosh Finance||Overnight||Loan needs to be approved by 3:30pm QLD time to be transferred overnight.||$2,200 - $4,584||More|
|Wallet Wizard||Same day||Loans need to be approved by 2:30pm to receive same-day funds.||$500 - $8,000||More|
Alternatives to online cash advance loans
- 0% interest financing from retailers
Some retailers offer interest-free periods on the sale of their goods and appliances. For instance, The Good Guys offers up to 50 months interest-free on home appliance purchases with a minimum spend in-store or online.
This loan is for low-income earners. It is offered by 170 local community organisations across 600 locations in Australia. You can borrow up to $1,500 to pay for bills and essentials, with terms ranging from 12 to 18 months. As the name implies, no interest is charged. You will only pay for what you borrow.
You can make interest-free purchases and pay in instalments. Many retailers now offer this option, allowing you to break down your repayments into smaller, more manageable chunks. There are also buy now pay later services that let you pay your bills in instalments. Providers like Afterpay also offer a “retro” option, allowing you to retroactively pay in instalments. You can get up to $200 credited back to your account.
Another alternative is a 0% interest credit card. Keep in mind that after the introductory period, the interest rate reverts to the standard rate. When that happens, you’ll be charged interest on the balance you haven’t paid off during the 0% p.a. period.
How can I apply for an online cash advance loan?
🤔 Work out what type of loan you need, how much you need to borrow and what you can afford.
🔎 Start comparing lenders and loan products. Don't forget to compare interest rates, fees and eligibility criteria. You can use Finder’s comparison table.
✅ Select a lender. Click “Go to site” to be directed to the lender’s page, or “More info” if you want to read about the lender.
🖨️ Organise and prepare the required documentation. This will make the application process easier.
📱 Apply. Most lenders have their applications online.