Payday Loans in Australia: Everything You Need to Know!

No matter how financially responsible you are, you might come across an urgent expense or sudden purchase. And if your payday is weeks away, you might start looking for payday loan options. When it comes to payday loans, Australia has many lenders who offer them. Let’s look at these financial products to determine if they’re right for you.

What this article covers:

What Are Payday Loans?

Known as a payday advance, small-dollar loan, or salary loan, a payday loan is a small, short-term loan designed for small purchases and emergency expenses (like bills) that you can’t afford. They’re perfect for months when your budget isn’t enough to cover your expenses.

Of course, the exact loan amount you can borrow depends on your suitability for the loan, as loan providers can only lend you what you can comfortably repay. But these loans typically range from $200 to $2,000.

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Accordingly, they’re unsecured payday loans, meaning that you don’t need to provide collateral to receive them. Then, you can cover your purchase or expense and repay the loan on your next payday or several paydays (over a few months).

However, the lack of security means a higher risk for lenders. They charge higher interest rates than they do for standard personal loans and mortgage loans, making the loan worth the risk. Still, the Australian Securities and Investments Commission (ASIC) governs those rates to protect borrowers against loan sharks.

Do I Qualify for a Payday Loan?

The eligibility criteria for payday loans are almost the same for other loan types. Although requirements may differ across lenders, some basic points include:

  • To be 18 or older
  • To have Australian citizenship or permanent residency
  • To have regular, sufficient income (compared to the loan amount)
  • To have a checking account

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Applying for Payday Loans in Australia

Since these financial products are made for sudden expenses and emergencies, their application process is deliberately simple and fast. It’s typically composed of three steps.

1. Submit the Application

Fill out the simple online form. You can start by adding your preferred loan amount, loan term, and the reason you need this loan. Additionally, you should enter your personal information and provide any required documents, such as your:

  • Full name
  • Gender
  • Physical or residential address
  • Contact details, including your mobile number, telephone number, and email address
  • Qualifications and education
  • Occupation (by providing pay slips, job history, or other documentation forms)
  • Bank account details
  • Bank statement data for the 90 days before your application
  • 100-points of identification
  • Tax returns for the past two years
  • Evidence of your borrowing history (such as loans and mortgages)

2. Wait to Get Matched

When we receive your application, our team searches for lenders who’d be willing to offer you the loan you want. This process can take as little as a few moments! Once we find you a match, we’ll get you in touch with them.

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3. Receive Your Funds

The loan provider will assess your circumstances, including your income, expenses, spending habits, recent transactions, unpaid loans, and credit reports. This way, they can determine if you’d be able to afford the loan repayments. If so, you’ll get approved, and they’ll draft a loan contract for you.

When you receive the draft, read it thoroughly (preferably with legal and financial experts) before signing it. Then, your lender will approach you to agree with you on the fund transfer method.

Why You Should Get a Payday Loan

If you get a lender payday loan, you can enjoy several perks, including:

High Acceptance Rates

Payday loans online are relatively easy to secure. The eligibility criteria are lenient, allowing many Australian citizens to get the support they need. If you have bad credit, you can get approved for bad credit payday loans or payday loans without checking account requirements. After all, lenders care more about your current finances than your past mistakes (even if they check your credit).

Also, payday loan providers may accept applicants who receive government benefits. So, you may get a Centrelink payday loan if you have a stable Centrelink income.

In comparison, many banks and financial institutions have strict requirements, expecting almost perfect credit scores, healthy credit files, and strong cash flows.

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Quick Payout

You probably want to get online payday loans fast to handle a pressing expense that can’t wait till your next payday. So, you’ll appreciate that these loans come with quick payouts. It starts with a quick and easy application process that you can complete 100% online. 

Then, you’ll get matched with a lender who’ll offer you same-day payday loans Australia or loans in a day or two.

Fast Repayments

If you feel uneasy when you owe others money, you can rest assured that urgent loans online get repaid fast. Many lenders will agree with you on a single payment for the loan, which makes sense considering how small it is.

Even if you pay it over a relatively long loan term, you’ll be done in a few months. Not to mention, most payday lenders accept early repayments and don’t charge additional fees for them.

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Concerns About Quick Online Payday Loans

There are a few downsides to consider before you get a payday loan online.

High Costs

Unfortunately, if you need a payday loan now, it can be costly. After all, these short-term payday loans are small amounts and mostly unsecured. This lack of security drives lenders to charge high rates, compensating for the risk they’d be taking.

Nonetheless, the ASIC has regulations to curb costs for instant transfer payday loans. You’re applying for Small Amount Credit Contracts (SACCs), which are loans under $2,000 that get repaid over no more than a year. So, payday loan direct lenders can’t legally charge interest rates. Instead, they can demand:

  • A fixed monthly fee of 4%
  • A 20% establishment fee on the loan amount
  • Government fees (if applicable)
  • Enforcement and default fees

Small Amounts

There’s a limit to how much you can borrow on such short notice and without security. Online fast payday loans are usually a few hundred dollars to $2,000. So, you can use them to cover:

  • Medical bills
  • Unusually high water or electricity bills
  • Vehicle repair
  • Vehicle registration costs
  • Veterinary bills
  • Extra cash for the holiday
  • Gifts for family and friends
  • Unplanned purchases

However, large expenses, such as college tuition, vehicle purchases, and pricey electronic devices, will be difficult to cover with such loan amounts.

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FAQs

How Do Loan Repayments Work?

Loan repayments for instant small payday loans and other loans are super simple. All you have to do is set up a direct debit payment. This way, your loan repayment amounts will be automatically withdrawn from your bank account. And you can decide if the repayments will be weekly, fortnightly, or monthly.

Are Payday Loans Legal?

Yes, payday loans are legal and available in all six Australian states. Just make sure that they abide by the ASIC regulations, or let us find you reputable ones who do!

Can You Get Payday Loans Without Credit Checks?

We don’t perform credit checks at Orange Loans, but some of the lenders we work with do. If you want fast easy payday loans with no credit checks, we’ll do our best to accommodate your needs. Regardless, our lenders assess your application based on your current finances rather than past financial hiccups (even if they conduct credit checks).

What Happens if I Miss a Payment?

Since repayment withdrawals are automatic, you might get charged dishonor fees from your bank if there aren’t sufficient funds in the bank account. Also, the payment default will appear on your credit report, and there might be enforcement action. Instead, you can communicate with your lender beforehand to set up an affordable payment plan.

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Final Thoughts

If you’re looking for payday loans, Australia has numerous lenders who offer them. These loans can get you through any sudden hiccups, covering your unexpected or high bills or unplanned purchases. They have easy application processes and come with quick payouts!

Payday loans give many Australian citizens access to quick cash (even if they have bad credit or are on Centrelink payments). What matters is that they can comfortably repay these loans. You can pay back the small loan amounts fully or partially on your next payday, and you won’t be charged an interest rate (only a fixed monthly rate and a few fees).

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