amount loans and the big
need that exists for them
comply with strict
government regulations
Read the Myths and Facts
about the small amount loans
industry in Australia
Find out more
UNCOVER THE MYTHS AND FACTS ABOUT SMALL AMOUNT CREDIT CONTRACTS (SACCS)
MYTH: An ‘Annual Percentage Rate’ can be used to calculate the cost of repaying a small loan
Would you borrow money at a 365% annual interest rate? Of course not! But what if you needed $100 today, with a full repayment of $101 tomorrow? That’s only 1% interest but expressed as an APR – well, that’s 365%. That’s why reports of high rates of interest are so misleading.
FACT: All fees on small loans are capped
Fees are capped at a maximum of 20% to establish the loan and 4% per month. This means, if a small loan of $1,000 is repaid within 4 months (the average) with no defaults, it will only cost $360 with a total amount repaid of $1,360.
More Facts
The stats: The big need for small loans in 2014-15
In November 2013, NCPA engaged an independent research firm, CoreData, to undertake a two-year data research project into the small and medium amount loans industry – the single largest research project since legislation changes came into effect in 2013. Here are some of the key findings from that report.
0 MILLION
Number of SACCs applications
0.3 MILLION
Number of SACCs entered into
0K
Number of people who took out a SACC
$0
Average small loan amount
0 DAYS
Average time taken to repay small loans
0 YEARS
Average age of male borrowers