payday loan interest rate

Payday Loan Interest Rates

Find out what you will pay with payday loans, and if the cost is worth the convenience.

Payday loans can offer you a way to get quick access to cash. Whether you need to get your car repaired or pay off a forgotten bill, these loans are designed to cover you when you’re caught short before payday. Before you decide to take out a payday loan it’s important to understand how they work, what fees are involved and what interest rates are charged.

How does a payday loan work?

Payday loans work by offering you a small amount of money, usually between $100 and $2,000, that is given to you as a loan. These loans are referred to as "payday" loans because the amount and terms are usually set according to your income and pay frequency, and are designed to be paid back in line with when you next get paid.

How much are payday loan interest rates?

Payday lenders are restricted as to how much they can charge you in interest and fees. It also depends on how much you borrow. Here is a breakdown of the maximum fees and rates payday lenders are able to charge you:

Loan amount Establishment fee Monthly fee Interest rate
Up to $2,000 20% of loan amount 4% of loan amount N/A
$2,001 - $5,000 $400 N/A 48% p.a.
Over $5,000 N/A N/A 48% p.a.

The above caps don't apply to authorised deposit-taking institutions such as banks, credit unions or building societies.

What is my payday loan interest rate?

Your "interest rate" depends on how much you are borrowing and for how long, but you can get an indication of the rate and costs using the payday loan calculator below. Use the slider to select how much you want to borrow and for how long, and you will get an indication of how much you will be charged.

This calculator is designed to provide you with an estimate based on the numbers you enter. Your personal details are not taken into account and all calculations are based off the calculation model. This calculator is not intended to be the sole source of your information when making a decision regarding your loan, and this calculator also does not guarantee your eligibility. The calculator works off the following assumptions: fees do not change for the life, your lender will charge a 20% establishment fee and a monthly fee that is 4% of your principal loan amount. You may want to seek advice from a financial professional before signing up to a loan.

How do these interest rates differ to rates of other financial products?

While these restrictions help to keep payday loans manageable, you need to compare them to other credit options that are available.

  • Credit cards. Credit card interest rates vary depending on the type of card you hold. Some rates can be as low as 9% p.a., while others can be as high as 22% p.a. Credit card rates are variable while payday rates are fixed. A good comparison to make with payday loan interest rates are credit card cash advances rates, which are typically around 22% and also give you convenient access to cash.
  • Personal loans. The interest rates charged on more traditional personal loans vary, but usually carry rates of between 8% p.a. to 15%. The rate you are offered depends on whether the loan is secured or unsecured. You can compare and read more about personal loans on this page.

What other fees and charges come with payday loans?

Lenders are able to charge the establishment and monthly/annual fees outlines above if you keep your loan in good standing. If you make payments late or default on your loans, lenders may also charge the following:

  • Default fees or charges. These are charged by the lender if you default on the payday loan. This amount is set by the lender and may include late fees that are charged until you pay the loan back.
  • Enforcement expenses. These are charged if you fail to pay back to the loan and the lender is forced to take you to court.

Sunshine Short Term Offer

Sunshine Short Term Offer

  • Bad credit applicants considered
  • Fast approval service
  • Borrow up to $2,000
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Sunshine Short Term Offer

A short term loan with a fast and easy application available to those with good or bad credit. You can apply today and get approved for up to $2,000.

  • Loan amount: $2,000
  • Loan term: 9-12 weeks
  • Turnaround time: 30 minutes (conditions apply)
  • Fees: 20% of borrowed amount + 4% of borrowed amount each month
  • Income requirement: 50%+ of income cannot be from Centrelink
  • Bad credit borrowers OK
  • Quick and easy Approval
  • No Credit Checks
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Compare costs of payday loans

Updated June 18th, 2019
Name Product Maximum Loan Amount Term of Loan Turnaround time Costs Fortnightly Repayment (for $1500 Loan)
9-12 weeks
30 minutes - conditions apply
20% of loan amount + 4% of loan amount each month
A small loan up to $2,000 that you repay over 9-12 weeks. Loans approved and funded in as little as 30 minutes. Centrelink must not be your primary income
Up to 2 years
3 hours - conditions apply
Apply for up to $2,000 and be able to access your approved loan as a convenient line of credit.
62 days to 1 year
1 hour - conditions apply
20% of loan amount + 4% of loan amount each month
A loan up to $2,000 with terms up to 62 days to 1 year. Centrelink cannot be your primary source of income.
22 - 52 weeks
Same day - conditions apply
Up to 2K - 20% establishment fee + 4% monthly. Above 2K - $400 + from 8.7% to 48% APR
Borrow from $1,000 to $5,000 with same-day funding and no early repayment fees.
6-12 months
Same day - conditions apply
20% of loan amount establishment fee + 4% of loan amount monthly.
Credit24 offers this loan up to $2,000 and gives you 12 months to repay.
3-12 months
1 business day
Establishment fee from 10% of loan amount + monthly fee from 2%
A small loan between $500 and $2,000 that can be funded in 24 hours.
6 to 12 months
20% of loan amount + 4% of loan amount each month
A short-term loan from $500 that you can have up to 12 months to repay. All credit histories considered.

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How you can compare payday loans

While lenders are restricted in terms of the fees they can charge, it’s still important to compare your options based on other features offered by then. Here are some things to look out for when comparing your payday loan options:

  • What is the loan turnaround time?
    Most payday lenders offer a quick turnaround time, although some may be quicker for others. Be sure to check when they will be able to transfer your loan amount to you and whether this will meet your needs as a borrower.
  • Is the lender easy to contact?
    As most payday lenders operate online, you want to be sure they are easily contactable via phone, email or live chat. If you are having problems with repayments or need to ask questions, you will want to be able to get in contact with them.
  • Does the site have clear information?
    You should also check that you are able to find all the information you need on their website. See if you can find a page for frequently asked questions, information about their fees, and terms and conditions.
  • What are the loan terms and amount?
    You should also check that you will be offered the loan amount and terms that you need. Some lenders only offer a small loan to new borrowers, while some may only offer loan terms that will make your repayments too high to afford.
  • Does the loan have any additional features?
    Some payday lenders offer other benefits and features that may be of interest to you. For example, Nimble offers a prepaid Visa Debit card that allows you to receive your loans instantly should you need to borrow again.

Things you should consider with payday loans

As with any type of loan, you need to consider your own personal financial situation before you decide to take one out. You should think about the amount you’re looking to borrow, the loan terms that you may be offered, and whether the repayments will be affordable to you. You should also consider whether a payday loan is the best type of finance for you, or whether you might want to look at credit cards, a line of credit or a secured or unsecured personal loan.

Want to apply? Here's how

To apply for a payday loan you can compare your options using the comparison table on this page. Once you find a lender you can click ‘Go to Site’ and be directed through to the lender’s online application form. To apply you will need to be over the age of 18 and be receiving some sort of income directly into your bank account.

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