If time is of the essence and you need a quick injection of cash sooner rather than later, you might consider opting for a fast approval personal loan. A lot of the time, you’ll need to find a digitally-focused lender. The trade-off is that you might face a higher interest rate, but there are ways to avoid being ripped off.
What is a fast approval personal loan?
A fast approval loan is a type of loan that’s processed and approved much more quickly than traditional loans, often within minutes or a few hours, instead of days or weeks.
In this space, there are generally two options:
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Short-term credit contract (STCC): According to the the National Consumer Credit Protection Act (NCCPA), an STCC is a loan that: isn’t part of a longer-term or low-cost loan, is offered by a lender that isn’t a bank or similar institution (not an ADI), has a limit of $2,000 or less (or another amount set by law), and must be repaid within 15 days.
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Small amount credit contract (SACC): This is a loan that isn’t part of a continuing or low-cost credit contract, is provided by a lender that isn’t a bank or ADI, has a limit of $2,000 or less (or another amount set by law), runs for between 16 days and 1 year, and is unsecured.
Both are designed for people who need money urgently, whether it’s for a car repair, medical bill, or some other unexpected expense. The whole process usually happens online, from applying to getting the money in your account. Lenders use automated systems to review your information fast, so you don’t have to wait around.
However, they are regulated differently and for short-term credit contracts, you might face much higher rates and fees when expressed as a percentage per annum.
Curious about regulated, digital lenders with quick approvals? Below is a selection of both secured and unsecured personal loans.
How long does it typically take to get a personal loan?
When considering a personal loan, a common question for many borrowers is, “How long does it take to receive the funds?” The timeline can vary based on several factors, including the lender’s processes, the applicant’s financial profile and credit score, and the completeness of the application.
The time it takes to complete each stage of the personal loan process can vary, but here’s a general overview of what applicants can typically expect:
|
Stage |
Typical Timeframe |
|---|---|
|
Application Submission |
Several minutes to complete |
|
Approval Decision |
From a few hours up to several business days |
|
Funds Disbursement |
Several business days to a few months |
Factors that affect approval time
Here are a few things that can either speed up or slow down the approval time of your loan:
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Type of lender - Online lenders often offer faster approvals than traditional banks.
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Credit profile - If your credit is in good shape, approval is usually quicker.
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Loan amount requested – Larger loan amounts often require more scrutiny, which can slow down approval.
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Verification processes – Some lenders perform more extensive background or employment checks that can add time.
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Existing relationship with lender – Borrowers who already have accounts or credit history with the lender may benefit from quicker processing.
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Automated vs manual review – Lenders that rely heavily on automated systems can approve loans faster than those requiring manual underwriting.
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Secured vs unsecured: If you are using something to secure the loan against, you might get a lower interest rate. However the lender will have to assess the suitability of that asset as security, which could slow things down.
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Having all the necessary documentation: You’ll likely need to have your ID, proof of employment, bank statements and information about other debts. Having all of this ready to go when you first apply is crucial to a speedy approval.
How do fast approval personal loans work?
Fast approval generally means that you will receive funds pending your application within the day if you apply and are approved during business hours. In some cases, these loans can be approved in a matter of minutes or hours, which is a far cry from waiting days for approval for a standard personal loan or credit card.
These loans usually have shorter terms than standard personal loans, typically ranging from a minimum of three months up to 24 months.
Some have terms shorter than 62 days, and these are typically called ‘payday loans'. As we explained earlier, regulation means it’s getting harder for these types of lenders to operate, but be wary of brands promising ‘fast approval’ who might prey on your urgency. The rates and fees on these can be sky-high.
If in doubt, look for an Australian Financial Services Licence (AFSL), Australian Credit Licence (ACL), or a banking licence (Authorised Deposit-Taking Institution or ADI) at the bottom of their website.
Fast loan pitfalls
While fast loans may seem like an easy fix, especially in emergencies, they’re not always the best financial solution. Consider the following before applying:
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Interest rates can be very high, in some cases exceeding 48% p.a., depending on the lender and loan type. These interest rates are typically found with bad credit loans and payday loans.
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Additional fees can significantly increase the total cost (higher than those for standard loans), i.e. establishment fees, monthly account-keeping fees, and late payment penalties.
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If your credit score is lower, you may face higher interest rates, stricter repayment conditions, and smaller loan amounts.
When all of these add up, a seemingly innocent small loan can quickly blow out to well beyond that figure.
How can you increase your chances of fast loan approval?
The best way to secure a fast turnaround on your loan is to ensure that you fit all of the eligibility criteria. Lenders have specific criteria for several product offerings, so it's important to check beforehand to avoid any unnecessary hiccups.
These requirements will typically include:
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Aged 18 or over.
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Are an Australian citizen or have permanent residency in Australia.
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Are in steady employment, earning sufficient income to satisfy loan repayments.
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Have 100 points of identification - birth certificate, passport or Medicare card.
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Personal details including address, valid email, mobile phone number and bank account details.
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Have a reasonable to good credit rating.
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Have no records of bankruptcy or insolvency.
You will also be required to provide at least the last three months' worth of pay slips to prove your income, as well as bank statements to allow the lender to see how responsible you are in managing your cash inflows and outflows.
Tips for a successful loan application
Before commencing your fast personal loan application, check your credit profile through one of Australia's three credit reporting agencies - Experian, Equifax, illion - to determine if there are any hurdles that may prevent you from receiving a loan. Very few providers offer personal loans without checking credit history, as the checks protect both you and the lender from taking on too much debt.
Importantly, the more applications you make, the more hits will be made to your credit profile, which can potentially tarnish your overall credit rating. You should only apply to providers that you fit the criteria for and for amounts that do not exceed your means, otherwise you'll be rejected outright.
Comparing fast personal loans
If you are in the market for a fast personal loan, consider asking yourself the following questions before choosing which lender to apply with.
How much can you comfortably borrow?
Most fast personal loans don't go over $5,000, which means if the amount you require is more than this, you may elect to opt for a standard personal loan. Generally, the greater the amount borrowed, the more interest is required to be paid over the life of the loan. To help calculate how much you may be able to borrow and repay with a fast personal loan, check out InfoChoice's Personal Loan Calculator.
How long do you need to pay the loan back?
Fast personal loans will typically range in loan term length from a couple of months up to five years, with larger loans sometimes featuring a seven-year term. Typically, the shorter the loan term, the less interest you'll pay, but the higher your repayments.
Many lenders will impose early repayment penalty fees to meet the interest expense lost for paying off a loan early, therefore, this should be factored into calculations when searching for a fast personal loan lender that charges no early repayment fees.
If you find that you can pay off the remaining balance of your loan earlier than scheduled, make sure you keep figures on hand, as an early repayment penalty could cancel out the savings you make on the interest.
How quickly will you receive the funds?
Fast means different things to different people. You may need the money within an hour or two, or you might be OK to wait for two days or more. The turnaround time is an important factor in your choice.
How quickly will the loan be funded? Since you're looking for a fast loan, this is an important aspect to compare. While some lenders give you access to funds within an hour, most will take 24 or 48 hours.
How much will the loan cost?
There's the interest loan to take into account, of course, as well as any establishment fees and ongoing fees or costs. These additional fees affect the overall cost of the loan and lenders have their own fee schedules, so make sure you assess the comparison rates when conducting your research.
Alternatives to fast personal loan
If you're in a tough spot and need quick access to money, there are safer alternatives to high-cost loans. Here are some options you can check out:
Good Shepherd Loans (NILS and StepUP)
Good Shepherd offers two affordable loan options for people on low incomes. First, the No Interest Loan Scheme (NILS), which provides interest- and fee-free loans up to $2,000 for essentials like appliances and car repairs.
On the other hand, the StepUP Loan is a low-interest loan ranging from $800 to $3,000, designed for urgent expenses such as medical bills or home repairs. It’s a joint program involving Good Shepherd Microfinance, NAB, and the Australian Government (via FaHCSIA), combining efforts across the community, private, and public sectors to offer low-cost credit.
Both loans are offered through community organisations and aim to provide fair, manageable repayment terms for borrowers.
Centrelink Advance Payments
Centrelink offers advance payments on future welfare benefits to help recipients cover urgent costs. This option allows you to access funds early and repay them gradually through your ongoing Centrelink payments, providing a no-interest way to manage unexpected expenses without turning to costly loans.
Salvation Army Emergency Financial Assistance
The Salvation Army provides emergency financial support for urgent needs like rent, utilities, or food. While not a loan, this help is interest-free and designed to ease immediate financial pressure, helping people avoid expensive borrowing.
