On 12 June 2023, new laws come into effect under the Financial Sector Reform Act 2022 which will change the way we can offer financial solutions to consumers who apply for a Small Amount Credit Contract (SACC) loan. Cash Converters will continue to strive to provide financial options for you, but these may look a little different.
The new laws introduce changes that are specific to SACC loans. This includes increasing the protected proportion of a consumer’s income that can be applied to repayments on SACC loans (called the ‘Protected Earnings Amount’ or PEA Cap). From 12 June 2023, this will mean that your total combined repayments across all SACC loans (whether those loans are held with Cash Converters or other lenders) cannot exceed 10% of your net income. You’ll know these loans as our Small Loans or Cash Advance loans.
Ted has a net income of $500 per week. With the introduction of the new laws and changes to the PEA Cap, Ted’s repayments for all SACC loans (including any SACC loans with Cash Converters or any other lender) cannot exceed $50 across all his loans (which is the 10% cap).
Whilst there are new legislative changes, the way you apply for a loan with Cash Converters will stay the same and you can still apply online or in-store.
Find your local store and chat to one of our friendly personal finance team members
Complete our online form and we'll get back to you shortly. Or, get in touch with your local store
Send us an email and we'll get back to you as soon as we can
The Financial Sector Reform Act 2022 (the Act) was introduced by the Federal Government to reform the consumer credit laws which apply to Small Amount Credit Contracts. The Act is aimed at enhancing consumer protection.
A SACC is a loan of up to $2000 with a loan term between 16 days and 12 months. Cash Converters SACC products include our Small Loans or Cash Advance between $50 and $2,000.
The PEA Cap will prevent a licensee (e.g. Cash Converters) from entering into, or offering to enter into, a SACC loan with a consumer if the consumer’s total repayments under the proposed SACC loan and any other SACC contract that they have, exceeds 10% of the consumer’s net income. This applies to all consumers, regardless of whether you are employed or are receiving Centrelink benefits.
Yes! You can still apply the same way with Cash Converters (online or in-store), and we will assess your application in accordance with any changes that have taken effect under the new laws.
Your existing Cash Converters loan(s) will not be affected. You will still be required to repay your outstanding personal loan balances in accordance with the terms of your existing loan contract.
You can visit your local store and chat to one of our friendly personal finance team members, complete our online form or send us an email and we’ll get back to you as soon as we can.
We’re responsible lenders and we want to make sure our customers are at the heart of everything we do to help find the right cash solution to make life possible.
We'll take a close look at the information and documents you provide us - including details of why you need the cash loan and how much you need to borrow, plus things like 90 days of bank statements, any existing credit card debt, and a careful assessment of your living expenses.
We do all this to ensure your cash loan is suitable, and meets your specific needs and situation to help you get on with your life.
If you have any questions about your application and how we assess, talk to one of our personal finance team members
Our Cash Advance Loans incur a 20% establishment fee and a 4% monthly fee, based on the amount borrowed. For example, a small loan of $100 over 4 weeks has fees and charges totalling $24 (1 x $20 + 1 x $4), resulting in a total repayment of $124. Cash Advance Loans are only available in-store with a minimum loan term of 4 weeks. The minimum term is 4 weeks and a maximum of 20 weeks.
Our Small Personal Loans incur a 20% establishment fee and a 4% monthly fee, based on the amount borrowed. For example, a small loan of $1,000 over 9 months has fees and charges totalling $560 (1 x $200 + 9 x $40), resulting in a total repayment of $1,560. The minimum loan term is 2 months and a maximum of 12 months.
Our Medium Personal Loans incur a $400 establishment fee and interest at 48% per annum. For example, a medium loan of $3,000 repaid by monthly payments over 1 year would equate to a total amount payable of $4,348 (including a $400 establishment fee). The minimum loan term is 4 months and a maximum of 24 months.
Our Line of Credit product does not incur an establishment fee and interest is at 48% per annum. For example, a line of credit of $4,000 repaid by monthly payments over 3 years would equate to a total amount payable of $7,616. The maximum repayment term for a credit limit of up to $2,000 is 18 months; and the maximum repayment term for a credit limit over $2,000 is 36 months. This example has been calculated on a specified credit limit with the assumption that the debtor has drawn down the maximum amount of credit as agreed to under a contract.
Our loans are repayable in weekly, fortnightly or monthly instalments. Loans can be settled early with no penalty and fees will only be charged whilst there is an outstanding balance on the loan, hence early settlement will reduce the amount payable on the loan. Loans are subject to assessment criteria and suitability. An APR (Annual Percentage Rate) does not apply to our Cash Advance Loans or Small Personal Loans. The maximum APR on our Medium Personal Loan is 144.02% and the maximum APR on our Line of Credit is 48%. These calculations do not account for potential additional fees and charges, such as default charges, which may be incurred.
