Personal Loan in South Africa - Find The Best Offers

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We’ve all had that moment when we’re hit with an unexpected expense and we just can’t seem to find the money. Or we have a wedding we need to pay for, but we don’t have the necessary reserves. For any of these situations, we can choose to turn to debt to get us through, and of all the types of debt available – personal loans are some of the most common and the most popular.

Personal loan lenders in South Africa

Nedbank
Minimum Amount:
R2000
Maximum Amount:
R300,000
Loan Period:
6 - 72 months
Estimated Interest Rate:
18% annually

Good to know:

  • Available to employed people
  • Loan option for self-employed / Contract workers
  • Have to earn a minimum of R3500/month
Fincheck
Minimum Amount:
R1000
Maximum Amount:
R175,000
Loan Period:
3 - 72 months
Estimated Interest Rate:
16% Annually

Good to know:

  • Apply under 2 minutes
  • Provides multiple offers
  • Not an actual lender
 
RSC
Minimum Amount:
R2000
Maximum Amount:
R250,000
Loan Period:
12 - 60 months
Estimated Interest Rate:
15% annually
Finchoice Personal loans
Minimum Amount:
R100
Maximum Amount:
R40,000
Loan Period:
6 - 24 months
Estimated Interest Rate:
N/A

Good to know:

  • Easy to apply
  • Interest rate range not announced
  • Also provide instant loans up to R10,000
Moneyshop
Minimum Amount:
R10,000
Maximum Amount:
R250,000
Loan Period:
12 - 72 months
Estimated Interest Rate:
15% annually

Good to know:

  • Uses bot for application
  • Also offers short-term loans
  • Must earn a minimum of R4000/month
African Bank
Minimum Amount:
R10,000
Maximum Amount:
R250,000
Loan Period:
7 - 72 months
Estimated Interest Rate:
15% annually

Good to know:

  • Get a quote in 3 minutes
  • Fixed monthly loan repayment
  • Requires proof of income document
Bayport
Minimum Amount:
R1000
Maximum Amount:
R250,000
Loan Period:
6 - 84 months
Estimated Interest Rate:
15% annually

Good to know:

  • Fixed monthly loan repayment
  • Offers debt consolidation loans
  • 24/7 service with mobile app
DirectAxis
Minimum Amount:
R5000
Maximum Amount:
R250,000
Loan Period:
24 - 72 months
Estimated Interest Rate:
15% annually

Good to know:

  • Also offers debt consolidation loan
Standard Bank
Minimum Amount:
R3000
Maximum Amount:
R300,000
Loan Period:
12 - 72 months
Estimated Interest Rate:
17,5% annually

Good to know:

  • Get a lower rate when you switch to Standard Bank
  • No early termination fees
  • Also offer Revolving loan -product
Table of Contents

What is a Personal Loan?

A personal loan refers to a loan where a financial institution lends an individual a lump sum that is used to make a purchase of some sort and then repaid over time with an agreed-upon interest rate. Personal loans are more of an umbrella term for a range of different loan types and these will all depend on the organization you are dealing with.

Types of Personal Loans

Personal loans are split into two different categories:

  • Secured personal loans require some form of collateral to be posted by the loan applicant as security for the institution providing the loan. This ensures that the company making the loan can recover some or all of their investment if the loan is not repaid as was agreed. Some examples of secured personal loans include a bond to buy a property, a loan to purchase a motor vehicle, or any other loan where you are ceding some form of security as part of the transaction.
  • Unsecured personal loans do not require any collateral to be posted. Instead, the loan provider relies on the credit score of the applicant to judge the risk of not being repaid and swallows any losses if the loan recipient does end up defaulting on their obligations. These loans can vary widely but some of the more common uses are education costs, home appliances, consolidation loans, home improvements, weddings, funerals, etc. Any time where there is an expense that is out of reach, a personal loan can be used to tide over that period and be repaid further down the line.

Personal loans are very valuable financial tools when they are used responsibly and with the requisite financial discipline to manage the debt over the medium and long term.

How to Apply for a Personal Loan

Every financial provider will do things slightly differently, so the application process will vary accordingly, but some of the major steps in applying for a personal loan are as follows:

  1. Look honestly at your current financial situation and determine if you really need to take this loan out. In addition, are you confident you will be in a position to pay it off?

  2. If you’re happy with the decision, then reach out to your financial provider of choice and acquire all the documentation and application forms you’ll need to fill out. Be sure to consider the impact of initiation fees as you do so – they can be significant depending on your overall loan amount.

  3. Complete all the required documentation honestly. They’ll typically require your ID, proof of residence, bank statements, income and expenses breakdown, credit score, and other identifying items.

  4. The financial provider will then calculate an appropriate interest rate and repayment term, in line with the loan amount that you’re applying for and your financial reputation as a consumer.

  5. If you are happy with the quoted terms, be sure to read all the terms and conditions before signing off on it.

  6. The money will then be deposited into your account, and you’ll incur the set monthly loan repayment going forward as was agreed.

How to Find the Best Personal Loan in South Africa?

With so many different options for personal loans, it can be challenging to figure out which one is the best option for you. Because it takes a lot of time and effort to put in the research necessary to compare every offer, most people will just go with a brand that they already deal with out of convenience. This is often a mistake because in most cases you won’t be getting the best deal and you’ll needlessly settling for a sub-optimal solution.

Instead, you should use a loan comparison tool like Loando which can gather all the relevant information into one place for you to make the best possible decision easily and quickly. Loando will collect all the available loan options and filter them for your specific needs to give you everything you need at your fingertips. They ensure that the information is current and accurate, and you be sure that you’re optimizing your personal loan choice without paying a cent extra.

Using this tool and finding a better deal can save you lots of money in the long run and it’s a secret weapon that makes finding a personal loan that much more efficient.

Frequently Asked Questions

This will depend on your credit score and financial history. The better your score, the less risky you appear to a financial provider, and the more money you’ll be able to access.

No, they aren’t considered income and so they won’t form part of your taxed income.

This will differ depending on the provider’s specific requirements but generally, you will need your South African ID, proof of residence, recent bank statements, proof of any income or expenses, credit score, etc.

Yes, applying for a loan online is possible with most providers these days. That’s why it’s even more valuable to compare them all using something like Loando because you can apply online from the comfort of your own home.

They can help your credit score as long as you make your monthly repayments on time. Making steady repayments helps to build your credit history and when you meet your obligations, it creates more trust and a higher credit score overall.