Interest-free Personal Loans
You can borrow up to $2,000 or $3,000 for bond or rent in advance, rates and other essentials when you're in need.
Is it possible to get a loan with 0% interest?
Yes it is. These are loans where no interest is charged for an interest-free personal loan. Interest is the fee you're charged by the lender for borrowing money.
The most common type of interest-free personal loan in Australia is Good Shepherd's No Interest Loans (NILs). Good Shepherd is a not-for-profit community-led organisation committed to providing affordable finance for Australians in need. It has a dedicated No Interest Loans team you can call on 13 64 57.
In this case, you are required to only repay the amount borrowed. With standard personal loans, lenders charge interest on top of the loan amount.
What is the NILs?
This is a no-interest loan designed by Good Shepherd to provide low-income earners access to safe, fair and affordable funding. No interest or fees are charged. If you're looking for income relief, you should consider this loan before opting for any other form of expensive credit.
No Interest Loans (NILs) allow eligible applicants to borrow up to $3,000, without having to pay any interest. You can use it to pay for essential goods and services, as well as some housing costs and expenses related to natural disasters.
How can I borrow money with no interest?
The eligibility criteria for NILs is different from that of a regular personal loan. This is because these loans are intended for people facing financial difficulties and who have low-incomes. You will have to prove that you're in need of these loans to be eligible.
To be eligible for Good Shepherd's NILs, you need to:
- earn less than $70,000 before tax as a single person, or
- less than $100,000 before tax as a couple
- You're also eligible if you have a Health Care Card or Pension Card
- You will also need to demonstrate that you can afford to repay the loan.
With a regular personal loan, you can use the funds for almost any legitimate purchase. You can use it to finance a car, a wedding or holiday, or just about anything you wish.
However, with these interest-free personal loans, they are usually only available for the purchase of essential household items and services. It is offered by around 500 providers across Australia.
"This type of loan can be really beneficial if you're rebuilding or getting back on your feet after a financial setback, as the lender doesn't take into account your credit score or repayment history when reviewing your application. Instead, they're focused on your ability to repay in the future, with a loan term of up to 24 months available.."
How does NILs work and what can I use it for?
Around 500 providers work with Good Shepherd to provide NILs to families in need of credit assistance. The basic premise is that as one borrower pays off their loan, those funds are then allocated to another borrower in need. This is called "circular community credit".
As we mentioned above, NILs comes with restrictions on usage. We've outlined what you can and can't use the loan for:
- Household items and essential appliances like fridges, stoves and washing machines
- Household furniture and repairs
- Car repairs and registration
- Medical or dental expenses
- Wellbeing and life event expenses
- Education essentials like laptops and books
- Employment expenses like licences and registrations
- Bond and rent in advance
- Council rates
- Costs associated with a natural disaster
- Food
- Bills
- Rent in arrears
- Debts
- Cash
How do I know if I eligible for NILS?
To be eligible for NILS, you need to:
- Earn less than $70,000 a year before tax as an individual, or $100,000 if you have a partner or children
OR
- Or have a Health Care Card or Pension Card
- Or have experienced domestic violence in the past 10 years
You also have to show that you can repay the loan.
Does applying for NILS impact my credit score?
No credit checks are performed when applying for NILS. This means that your score will not be impacted. Additionally, if you have bad credit, you can still qualify for the loan so long as you can prove it can be repaid.
How can I apply for NILS?
You can apply for a NILS loan by following a few simple steps:
- Check if you're eligible.
- Find the nearest NILS provider either online or by calling 13 64 57.
- Set an appointment with the provider selected.
- Submit your paperwork.
- Wait for your application to be assessed.
- You will receive the outcome by phone or email.
Are there other interest-free loans available?
If you don't qualify for NILS, there are other options available:
- 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 60 months interest-free on home appliance purchases with a minimum spend in-store or online. - A 0% interest credit card
Many Australian banks and lenders offer 0% interest credit cards, usually for a set period, such as an introductory offer on purchases for 12 months. - Centrelink cash advance
This allows you to receive an advance payment on your Centrelink benefits. This is not an additional payment, but a part of your existing allowance paid in advance. You may be eligible depending on how long you have been with Centrelink and how much you receive. You can contact the Department of Human Services for more details. - Buy now pay later
Buy now pay later allows you to buy an item or a service and pay for it in instalments. No interest is charged during the stipulated period. There are also buy now pay later services that let you pay your bills in instalments. - Pension loans scheme
If you qualify for a pension and hold equity in real estate, this government scheme uses the funds tied up in real estate as a non-taxable loan. The rate offered is significantly lower than the rates charged on other personal loans. You can contact the Department of Human Services for more details.
Personal loans for Centrelink applicants
How else can I get interest-free terms on purchases?
There are a range of credit cards which offer 0% introductory rates on purchases. You can compare a range of these products below. Keep in mind that you'll need good credit to be eligible.
1 - 14 of 14
Compare other products
We currently don't have that product, but here are others to consider:
How we picked theseWhy compare personal loans with Finder?
Addicted to details. We know taking out a personal loan is something you'll be hooked up with for a while. That's why we put hours into research for this guide (and still do at least once a month)
Rates obsessed. Lenders come in all shapes and sizes, that's why we don't just track the big banks, but all the digi folk too. Pretty much everyone but your parents to be honest. 
Cash for whatever you need. Lending rates verified from 180+ products day and night. Whether you're buying a car, rennovating your home or heck just ready to let loose with the spending - we got you.
Frequently asked questions
More resources on Finder
Ask a question
12 Responses
More guides on Finder
-
OurMoneyMarket Secured Personal Loan
Read Finder's review of OurMoneyMarket's Secured Personal Loan. See if this loan is right for you.
-
MoneyPlace secured personal loan
This secured loan may be used for any worthwhile purchase and requires security against a vehicle. It uses risk-based pricing, so your interest rate will be set based on your credit score and history.
-
NOW Finance Secured Personal Loan
A risk-based personal loan from one of Australia's biggest non-bank lenders. Get a personalised rate which rewards higher credit scores.
-
OurMoneyMarket Unsecured Low-Rate Personal Loan
A marketplace personal loan with personalised interest rates.
-
How much can I borrow with a personal loan?
Personal loans offer a range of loan amounts to suit different purposes and budgets. Here's how to get the loan amount you need.
-
NOW Finance Unsecured Personal Loan
An unsecured personal loan with zero fees and interest rates personalised to your risk profile.
-
MoneyPlace Unsecured Personal Loan
Why not be rewarded for your good credit history? MoneyPlace offers unsecured personal loans with rates starting at 8.49% p.a. – finance a range of personal purposes and borrow up to $80,000. Read the review and see if you're eligible to apply.
-
Personal loans for temporary residents
Temporary Australian residents may be eligible to apply for personal loans, depending on the visa they hold.
-
Easy personal loans
Not all personal loans come with endless documentation. Some lenders specialise in quick and easy application processes.
-
Personal loan calculator
Use a personal loan calculator to work out your repayments or compare loans with a comparison calculator.
I would like a interest free loan to buy a new motor for our air conditioner $15000
Hi Renee, Interest-free loans are very hard to come by. You could try reviewing some of these low interest loans.
Alternatively, you may be able to get a 0% credit card with 12 months of no interest, but this can be risky, as after the 12 months is up, vbery hefty interest rates of 20% or more would apply.
Hope this helps!
Our refrigerator is on the blink and we cannot repair it,
We need to buy a new one ASAP I am on a disability pension with my wife as my carer We have very little cash flow and savings but we own our house outright
Wots are our options of getting a low interest pension loan
Hi Raymond,
Thanks for getting in touch! Our page shows the list of providers who may accept your application. As it says on our page:
You need to meet a few criteria to be eligible for an interest-free personal loan:
Have a Health Care Card or Pension Card
Earn less than $45,000 per year
Have lived at your current address for at least three months
Show a willingness and the capacity to repay the loan
There are no credit checks required during the loan application process. Instead, interest-free personal loans are offered on a basis of trust and respect.
Hope this helps!
Best,
Nikki
Hi,
Can I get a home loan if I am on disability pension?
Hi Maryam,
Thank you for getting in touch with Finder.
Since some lenders accept Centrelink benefits as your sole source of income, all you need is to do some research or look for a mortgage broker to help you on getting a home loan. You may use our Centrelink home loan guide for your application.
I hope this helps.
Please feel free to reach out to us if you have any other enquiries.
Thank you and have a wonderful day!
Cheers,
Jeni
Can I borrow to buy a car I’m on centrelink benefits and I work. If so what is the most I could borrow ?
Hi Lisa,
Thanks for leaving a question on Finder.
If you’re looking to purchase a car, you can consider a secured car loan from a lender that accepted Centrelink applicants. You can purchase a new or used car and use it as security for the loan to get a lower rate. You can learn more about the types of loans available to Centrelink recipients.
Please send me a message if you need anything else. :)
Cheers,
Joel
Tanya
Need help fill in
Hi Tanya,
If you’re looking for assistance with your application you’ll need to get in contact with Good Shepherd Microfinance directly. I’ve emailed you its contact information.
Hope this will help,
Elizabeth