Need a laptop for university or school? Do you need to leave your residence but can’t afford the bond to a new place? Is your car registration due but you don’t have the money to pay for it? 

You can stop stressing now because there is a National No Interest Loans Scheme (NILS) run by Good Shepherd Microfinance. It is different to other finance companies or institutions as they don’t charge you any interest. What you borrow is exactly what you pay back.

Unlike ‘payday lenders’ and banks they are a national community organisation that does not make money from the loans they give out.

The loans are normally up to $2000 for essentials such as appliances, car-related payments like registration or repairs, or medical expenses. They can be up to $3000 for housing-related expenses such as bond or rent-in-advance. 

How do these loans work?

To qualify for one of these loans, you need to be a low-income earner. This means that you earn less than $70,000 annual income (before tax) as a single person or $100,000 annual income (before tax) if you have a partner or children. You are also eligible if you have experienced family or domestic violence in the last 10 years. You will also need to prove that you can afford to repay the loan. 

Normally, your low-income status is determined by whether you are eligible for a Low Income Healthcare Card. If you are on a Centrelink payment or only work casually or part-time you might be eligible for a low-income health care card which will give you a range of discounts and benefits. This might even make a difference to you needing a loan! to find out if you are eligible and how to apply click here.

How do I apply?

You need to make sure that the item you want to get a loan for is eligible. Then you need to get a quote for the item. They only pay the invoices and will not provide cash. It’s helpful to call the NILS provider nearest to you to find out if you can apply for the item you need. To locate a provider near you go to the NILS website or call 13 64 57.

After you have spoken to the NILS provider you will need to make an appointment for an interview where your income and spending are worked out to find out whether you can repay a loan.

The loan worker will go through a budget with you and help you figure out how much money you need to spend on living expenses each fortnight.

Paying back this type of loan is normally automatic. If you are on a Centrelink payment your loan repayment will be taken out before your Centrelink money goes into your account.

This is called a Centrepay deduction, to find out more about Centrepay deductions click here.

Weighing up the positives and negatives of No-Interest Loans

Positives:

• This form of credit is safe and does not require you to pay fees or Interest.
• The money won’t be paid into your account, it will go straight to the company you are purchasing your item from. This means that you don’t have to worry about spending it.

Negatives:

• You can’t apply for these loans just for some extra money; it needs to be for something in particular that is approved by the organisation beforehand like a washing machine or medical expense.
• You can only have one NILS loan at a time, but once it is paid off you can apply again.

A no-interest loan is a good way to pay for something that you would not be able to afford without some extra help! However, it is still a loan so you will still be required to pay it back within a certain amount of time.

If you are having a financial emergency

If you are in need of money urgently, Money Smart has great Australia-wide information and contacts for housing, income support, emergency relief and financial counselling. The Department of Human Services also has some helpful information on crisis and special help payments that you might be eligible for. 

Check out Financial Counselling Australia to find a counsellor near you, or call 1800 007 007 to speak to one on the phone for free advice.

You can also call the National Debt Helpline, they are open every weekday from 9.30am-4.30pm and their chat is open until 8pm. They offer free counselling to figure out a debt solution that will suit you. 

Aboriginal and Torres Strait Islander people can call Mob Strong Debt Helpline on 1800 808 488. Monday to Friday, 9.30am to 4.30pm.

If you are in debt, call Way Forward on 1300 045 502. Monday to Friday, 9:00am to 7:00pm. If you’re in financial hardship, they can arrange a debt repayment plan on your behalf. This is a free service.

If you are struggling with your mental health in this hard time — please reach out. Call Beyond Blue on 1300 22 46 36, 24 hours a day. Or use their live chat service, available 24 hours a day.