Nimble is a short-term loan provider that specialises in small loans ranging from $100 to $1600 throughout Australia. They promote their loans as simple, straightforward and quick – providing borrowers with funds in as little as 60 minutes. As with most short-term lenders, their approval criteria are a bit more flexible than the banks and credit unions – which can be a plus for those with impaired credit and needing cash immediately.
Also like most payday type lenders, the cost of borrowing money is high with a 20% establishment fee and 4% monthly fee. Should you have issues with your repayments, you will liable for additional fees including a possible dishonour fee or $35 and daily $7 default fee for each day your account remains in arrears.
Simply put, if you were to borrow $1000 inside 30 days you would pay back $1240. That’s $240 you would have to pay back for borrowing only $1000 (assuming you have no problems with the repayments). If you experience problems making your repayments, the costs can escalate beyond that figure quickly.
Nimble loans may be an option for some borrowers base, just be clear about the terms and the costs of borrowing – below are other considerations and responsible lending alternatives.
What to be aware of when dealing with short-term or payday loan lenders?
Short-term loans are quickly approved and fairly easy to get. However, they carry many unfavourable conditions and borrowers must be aware of that.
- Pay day loans, cash loans, short-term loans, what every they call them – are usually extremely expensive. Fees, penalties and delayed payment fees add to the exorbitant interest charged on short-term loans. You have a one-time or daily fee to compensate for delayed payment or unresolved credit.
- These lenders are often compared to loan sharks, who are always eager to take advantage of unfortunate situations and the borrowers’ bank accounts. Behind the lenient cash loan approval, there may present a risk of spiralling fees that significantly raise the cost of payment. Short-term loan fees often skyrocket unless you pay back the loan within the contracted time.
- The ease of acquiring cash and the client retention strategies that many have in place can lead to ongoing repeat borrowing. With the high cost of the loans, this truly benefits the lender and not the borrower.
- If you have a security, such as post-dated cheque or jewellery, a vehicle, etc. against a short-term cash loan, any default may result in greater suffering. Cheque bouncing results in higher penalties and the inability to make repayments mean you run the risk of losing your security.
What are alternatives to short-term loans?
One of the best ways to stay out of debt is to avoid borrowing when possible and only take out loans that are affordable with favourable terms in needed. Below are some genuine alternatives to controlling money and financial issues with and without borrowing.
If you are considering a loan to pay for utility bills, food or rent – consider instant benefits first.
- Consider a NILS or StepUP loan designed for low income earners with a borrowing limit up to $3000. These loans come with very little or no fees and low to no interest rates.
- Negotiate with utility providers and plan your payment in instalments. You also have an option to seek a rebate or emergency utility bill vouchers.
- Check if you are eligible for Centrelink benefits and can seek an advance payment.
- Explore small, personal loans offered by banks or credit unions or local welfare assistance funds in your neighbourhood.
- Possibly borrow from a family member if you have a strong relationship – be careful though, as issues with repayments can lead to relationship break down
How to handle issues with loan repayments?
The first step would be to contact the lender prior creditor and negotiate for rescheduling or restructuring when you are in distress (see financial hardship).
Consider speaking to a free financial counsellor as they may be able to negotiate with creditors on your behalf and can provide you with more options. In addition, they may be able to help with any loan charge problems that require communication with AFSA including free legal advice.
What to do if you are in a financial crisis and need immediate help?
There are a few options for serious financial issues including crisis payments, financial hardship assistance and special benefits. These services are to help those facing eviction, needing food, keeping utility services running and medical help and other serious situations.
Whenever facing a financial situation or crisis, it’s important to make smart choices and not to rush into any decision which can further exasperate the situation. A Nimble loan may be a good solution but its always good to compare against other options which may be more suitable. Getting professional assistance through free financial counsellors on non-biased non-profits or community organisations can be the difference in getting back on your feet quicker.