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Payday loan alternative could save Aussies thousands

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Cash-strapped Australians now have a new alternative to predatory payday loans and sky-high interest rates after Good Shepherd Microfinance launched Speckle, a short-term cash loan.

One in five Australian households have used payday loans in the past three years as an increasingly casual workforce, rising cost of living and low wage growth pushes more families into financial stress.

Speckle is an online cash loan backed by the National Australia Bank for amounts up to $2000.

Adam Mooney, CEO of Good Shepherd Microfinance, one of Australia’s largest microfinance organisations, says it is a low-cost alternative to traditional payday loans.

“In most cases, Speckle loans are up to 50% cheaper than other small cash loans. Most lenders charge the maximum fees allowed by law,” Mooney says.

Speckle fees include a 10% establishment fee and 2% monthly fee compared to the market norm of 20% and 4%.

Repayment options range from just three months up to one year, and can be repaid early with no extra fees, says Mooney.

Loan applicants must be over the age of 18, earn more than $30,000 a year (not inclusive of government benefits), and can’t have had two or more small amount credit contracts in the past 90 days.

Applicants who are ineligible are referred to other financial support.

Written by Effie Zahos

Effie Zahos

Money magazine editor Effie Zahos is the author of A Real Girl’s Guide to Money: From Converse to Louboutins. Effie started out as a graduate trainee for one of Australia’s major banks. She moved to TV in 1997, kick-starting her career in finance journalism as head researcher for Channel Nine’s Money Show. A regular finance commentator on TV and radio, she also wrote The Great $20 Adventure, a children's book aimed at enhancing the financial literacy of young Australians.

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