Personal Loan Rates: How To Find The Best in Australia

Monzi’s guide to personal loan rates. Find out how much interest you might pay on a personal loan today. Monzi explains all here.

Looking for a personal loan, but interest rates giving you a headache? Fear not! Monzi explains personal loan rates, how they work, and where you may find the best rates Australia has to offer. Interested? Read on to learn more about personal loan rates!

Please note, certain ideas and products presented in this article may not be offered by Monzi nor the lenders we work with. This article presents only general information. Consider seeking professional financial, taxation, legal or other advice to check how the information and ideas presented on this website relate to your unique circumstances.

What are personal loan rates?

Essentially, personal loan rates refer to the interest rate charged on your personal loan. In other words, your personal loan rate will determine the amount of interest you will pay alongside your loan. Personal loan rates are calculated as a percentage of your outstanding loan balance.

This rate stays the same throughout the course of your personal loan. As a result, your interest payments will slowly decrease, as the balance of your loan is reduced.

Personal loan rates calculate how much interest you will pay, so most people usually aim to find the lowest rate possible. That way, you can minimise the amount of interest you have to pay. Therefore, over the course of repaying your loan, low personal loan rates may save you money.

However, there are still a number of important factors you should consider. So, now that we know the basics about personal loan rates, let’s dive a little deeper!

What is a personal loan?

Essentially, personal loans are lump-sum amounts you can borrow to cover any personal expense, from an unexpected cost to a dream holiday that is just out of reach. But how exactly do they work?

Personal loans function just like any other loan. Put simply, you borrow a particular amount of money from a credit provider, and agree on the terms of your repayment. Then, the borrower typically repays their loan in weekly, fortnightly, or monthly instalments over the repayment term. Generally, this repayment term ranges from several months to several years, depending on your contract with the lender.

Furthermore, your repayments will generally consist of the original loan amount, as well as any interest and fees incurred. These repayments often occur through a direct debit from your account, withdrawing automatically until you’ve successfully repaid your loan­­. That way, you don’t have to do any of the heavy-lifting!

What determines the interest rate on a loan?

Everyone is unique in their own way, and personal loan rates are no different! Put simply, lenders may consider a range of factors when calculating the interest rate offered on your loan.

Some of these considerations may include:

  • Your credit history: If you’ve proven a reliable borrower in the past, lenders may offer you more competitive rates. On the other hand, loans for people with poor credit may attract higher rates to account for the lender’s risk.
  • The type of personal loan: Lenders typically consider unsecured loans to be riskier than loans secured by an asset. As a result, if you are willing to secure your loan with an available asset, you may gain access to lower personal loan rates.
  • Your loan amount: The personal loan rates charged on loans may differ depending on the amount you intend to borrow.

However, please note that the above list is not exhaustive. Lenders may also consider a number of other factors in calculating personal loan rates.

Are there different types of personal loan rates?

There certainly are! Essentially, interest rates can either be fixed or variable. It is important that borrowers know the difference, as your type of rate will largely impact your total loan cost.

Firstly, a fixed rate loan will stay the same throughout the term of your loan. From your initial acceptance of the loan offer to the day it is repaid, the rate will remain constant. As a result, it may be easier for you to manage and plan your loan repayments alongside your existing expenses.

In contrast, a variable loan rate may change over the period of your loan. Generally, lenders offer variable rates on longer-term loans. Although they may be more flexible, they present the risk that your rate might increase at some point.

So, before you accept a personal loan, make sure you know which kind of interest rate you’ll be dealing with.

What are the best personal loan rates Australia?

Well, that depends on how you define the ‘best’ personal loan rates. After all, Aussies are all different and have their own priorities when perusing options for personal finance.

For example, you may be looking for the cheapest personal loan rates overall, or simply the lowest rate for your specific loan type. Either way, we here at Monzi will do our utmost to help you find a personal loan to cover the expense you’re dealing with.

What are the cheapest personal loan rates?

In short, Monzi cannot say exactly what the cheapest personal loan rates are. After all, there are a range of different factors at play.

Not only will your loan rate depend on the lender you’re paired with, but also on the loan amount and repayment period.

So, to seek out the cheapest personal loan rates for you, review your financial situation. Then, consider possible options with a financial advisor or consult a loan calculator. Ultimately, though, your lender will determine your rate.

Therefore, Monzi, unfortunately, can’t tell you what the cheapest loan rates will be for you personally. However, we can guarantee that we’ll do our best to pair you with an available lender!

How do I compare loans?

Browsing for a personal loan, but unsure where to start? Monzi may be able to help.

While finding the best personal loan rates may save you money on your repayments, it shouldn’t be the only thing you consider. Loans can be complicated, and there are a multitude of factors to account for.

As a result, it’s crucial to compare and contrast different options when finding the right loan product for you. Moreover, doing your research could even reduce your total loan cost.

Specifically, compare loans using the following guide:

  • Interest rate, fees, and charges: How much extra will you be paying on your original loan amount? Check the comparison rate to get an idea of your annual loan costs.
  • Repayment terms: Are there suitable and affordable terms on offer? Is there any flexibility? Can you arrange repayments to suit your situation?
  • User reviews: How does the lender operate? What is their history with other borrowers like?
  • How much you can borrow: Does the lender specialise in a particular loan size? Do they have limits on how much you are able to borrow?

Overall, if you are browsing personal loans, ensure that you consider the factors listed above.

How do I get the best personal loan rates?

If we lived in a perfect world, Monzi would be able to tell you. Unfortunately, we’re not quite there. So, there is no sure-fire way to guarantee that you will be offered the best personal loan rates.

However, having said that, Monzi does have a few tricks up its sleeve on how you might access more competitive rates.

First, if you have good credit history and are a reliable borrower, lenders may offer you lower and more competitive personal loan rates. After all, good credit reassures lenders that you’re a less risky customer.

On the other hand, if your credit is not the best, securing your loan with an asset may also help. Then, the loan is guaranteed either way, and lenders don’t have to stress as much about potential losses. As a result, your lender may offer you a better loan rate. In other words, credit providers usually consider secured loans to be safer.

Ultimately, your lender will determine your personal loan rate. These are merely options to consider if accessing a low interest rates on your loan is a goal.

How do I find the best personal loan rates?

Sometimes, finding the best personal loan rates for you can be tricky. After all, not everyone has access to a financial advisor. However, even if you are unable to consult a financial professional, there are many other ways to discover the best interest rates for you.

Personal loan calculators can be particularly useful in helping you figure out what you can afford to borrow, and what the repayments might be.

So, what exactly is a personal loan calculator? In short, it is a quick and easy way to calculate what your regular repayments on a personal loan might be— all from the comfort of your own home. Typically, this estimate is based on what you intend to borrow and over what period. In other words, you input numbers, it spits out answers!

Simply enter your loan details as required, and the loan repayment calculator will generate what your regular repayments could be. For example, some basic loan details you may have to input could include:

  • Your expected loan amount
  • The interest rate
  • The repayment period

Are loan calculators accurate?

Only to an extent.

It is important to note that all calculated values are only an estimate. Generally, they are non-binding and used for demonstrative purposes only. If you decide to apply for a loan, your lender will determine your actual repayments.

However, it can often be beneficial to use a repayment calculator. For instance, you can change the interest rate to see how your repayment costs might differ.

Looking for a loan calculator, but not sure where to start? Fortunately, there is no shortage of online personal loan calculators. With one simple search online, you’ll be able to access numerous free resources that can assist you in calculating your personal loan repayments.

However, a good place to start might be the Australian Government’s Moneysmart loan calculator. This resource will efficiently calculate your regular repayments, how much you can afford to borrow, and how.

In addition to this, the Moneysmart website provides a wealth of information regarding financial and legal tips. It might be a good idea for potential borrowers to read and understand this financial information provided before applying for a personal loan.

personal loan rates

What are the interest rates on secured loans?

In order to compare personal loan rates, we also need to explore how they apply to different types of personal loan.

There are two main kinds of personal loan: secured and unsecured cash loans. The key difference between the two is the use of security against the loan.

In a secured loan, the borrower must nominate an asset as security in order to finalise the loan agreement. This asset, which usually takes the form of a vehicle, is used to guarantee the loan. Typically, Monzi works with lenders that may be able to accept a car, motorbike, caravan, or boat as security against a loan.

Essentially, if the borrower is unable to fulfil the required repayments, the lender will have to recover their losses. Generally, this means repossessing the nominated asset. Still, rest assured― credit providers usually view this as a last resort. In addition, there are also a number of protocols that lenders must adhere to before repossession.

However, because the loan is guaranteed with an asset, secured personal loans may incur lower interest rates and fees. But why? Basically, by nominating an asset as collateral, the borrower reduces the financial risk posed to the credit provider.

Unsecured personal loan rates

In contrast, unsecured loans require no security, but may have higher personal loan rates and fees. Generally, unsecured personal loans are smaller, short-term loans. Monzi finds lenders offering small, unsecured loans from $2,100 to $2,000 that can be repaid over a fixed 12-month period.

However, other than the use of collateral, there are a few other differences between secured and unsecured personal loans. So, let’s compare the different personal loans that Monzi’s network of lenders might offer:

Secured personal loansUnsecured personal loans
$2,100 to $15,000$2,100 to $2,000
13 to 24 month repayments12 month repayments
Security requiredNo security required
Bad credit consideredBad credit considered
Centrelink payments consideredCentrelink payments considered

Note: Lenders may differ in the terms they offer.

Small personal loan rates

Generally, personal loans will range between $2,100 and $15,000. So, lenders tend to divide different sized loans into three separate categories: small, medium, and large. Therefore, loans of different sizes will differ in their terms and personal loan rates.

Want us to be more specific? See the table below for a breakdown of how personal loans of various sizes may differ.

LoanAmount ($) AUDRepayments
Small loans$2,100 to $2,000Repaid over 12 months
Medium loans$2,100 to $4,60013 to 24 months
Large loans$15,000 to $15,00013 to 24 months

However, it is important to remember that lenders may vary in the repayments terms they offer.

Bad credit personal loan rates

It can be difficult to access loans with poor credit history. Fortunately, as non-traditional lenders become more popular, things are looking up for bad credit borrowers.

There are now several online lenders who consider bad credit applicants. In doing so, they assess a range of factors rather than simply focusing on your credit. In short, many credit providers now take a big-picture approach to lending!

By evaluating your financial situation and budget, lenders can determine what repayments you can afford. If you are able to satisfy all the necessary criteria, you may be offered a cash loan with bad credit. Keep in mind that lenders reserve the right to approve requests at their discretion.

In addition, bad credit loans may attract higher personal loan rates to account for the risk posed to lenders. However, Monzi cannot say with certainty what personal loan rates lenders will offer to bad credit applicants.

This is because the personal loan rates on a bad credit loan will depend on a number of factors, including:

  • Your financial situation, including income and outgoing costs.
  • Your preferred loan amount.
  • Whether the loan is secured or unsecured.
  • Your preferred repayment schedule.
  • The lender you’re paired with.

Payday vs. personal loans

When deciding between loans, you may have to choose between a payday and personal loan. But, what’s the difference?

Firstly, a payday loan is usually a small loan of up to $2,000. They are all about speed – from the time of your application approval to the cash appearing in your account. Moreover, repayment periods are typically short, while the interest rates and fees are often high.

In contrast, personal loans tend to be larger amounts of up to $15,000. Lenders will work hard to provide you with a speedy outcome, but repayments are usually spread across a longer period of time. In addition, the rates and fees may be lower. This often makes personal loans a more manageable and realistic option for borrowers.

Australian lending regulations

The Australian government protects everyday Aussies by placing a number of restrictions on lenders. This way, borrowers can be sure they will receive fair treatment. These restrictions include a cap on the fees lenders may charge, and a number of assessment requirements.

In short, lenders must assess your financial situation to determine whether the loan you’ve applied for is affordable for you. Assessments involve lenders fulfilling three key responsibilities:

  1. The lender must make reasonable inquiries into the borrower’s financial situation.
  2. Then, they must take reasonable steps to verify this information.
  3. Based on this data, the lender must provide a final evaluation as to whether the loan is suitable for the borrower.

Following this, lenders will provide the borrower with an outcome. Ultimately, these steps exist to protect the rights of the borrower. If credit providers properly comply with lending responsibilities, you should not be offered a personal loan that is unsuitable or unaffordable for your financial situation.

Applying for personal loans with Monzi

Monzi is an expert lender-finder service with a passion for helping everyday Aussies find the loans they need. Put simply, we match Australian borrowers with our network of reliable lenders.

With Monzi, you might be able to access anything from a handy $2,100 to a mega $15,000! Get every dollar you need, when you need it, and simply repay it over the coming months or years.

The best part? There’s no paperwork involved because we’re 100% online. So, apply online today and we may be able to pair you with a lender in minutes!

Am I eligible to apply with Monzi?

In order to apply with Monzi, you’ll have to tick off the following boxes:

  • 18 years of age or older;
  • Australian Citizen or Permanent Resident;
  • Have a current email address and contact number; and
  • Hold an online banking account with at least three months of transactional history.

Do you make the cut? Let’s get started then!

How do I apply with Monzi?

Financial stress may not be easy, but applying with Monzi is! Just follow these simple steps:

  1. Use our loan slider to select the amount you intend to borrow and preferred repayment period.
  2. Enter the personal information required.
  3. Wait while we try to pair you with an available lender.
  4. If you are successfully paired with a lender, then we’ll pass your application onto them. From there, the lender will contact you to complete an assessment.

Factor In Costs

You won't use a penny to apply for our lender-finding service, but here's some costs you could expect from a lender

Loan amount

$300 - $2,000


16 days (minimum)

12 months (maximum)


20% upfront establishment fee

+ 4% monthly fee


Representative example based on a loan of $1000 over 6 months a borrower can expect to pay a total of $1440.

Disclaimer: Under the current legislation, all Small Amount Credit Contract loan providers don’t charge an annual interest rate. The maximum you will be charged is a flat 20% Establishment Fee and a flat 4% Monthly Fee. The minimum loan term is 16 days and maximum loan term is 12 months. Representative example based on a loan of $1000 over 6 months a borrower can expect to pay a total of $1440.

Loan amount

$2,100 - $4,600


12 months (minimum)

24 months (maximum)


47.8% Annual Percentage Rate (APR)

65.85% Comparison Rate p.a.


Representative example based on a loan of $2500 over 24 months a borrower can expect to pay a total of $4,556.88.

The maximum interest rate for a Medium Amount Credit Contract is 47.8%. Comparison Rate 65.85% p.a. The maximum loan term is 24 months. Representative example based on a loan of $2500 over 24 months a borrower can expect to pay a total of $4,556.88. WARNING: This comparison rate is valid only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate with the lender that finances your loan. Credit criteria and terms and conditions apply.

Loan amount

$5,000 - $15,000


12 months (minimum)

24 months (maximum)


47.8% Annual Percentage Rate (APR)

47.8% Comparison Rate p.a.


Representative example based on a loan of $10,000 over 36 months a borrower can expect to pay a total of $18,995.04.

This is an estimate only and the comparison rate based on the example information provided. Other fees, costs and charges are not included. This calculation is not an offer for credit.The maximum interest rate for a Personal Loan is 47.8%. Comparison Rate 47.8% p.a. The maximum loan term is 24 months. Representative example based on a loan of $10,000 over 36 months a borrower can expect to pay a total of $18,995.04. WARNING: This comparison rate is valid only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate with the lender that finances your loan. Credit criteria and terms and conditions apply.