NILS Loans: What are no interest loans?

What is the No Interest Loan Scheme?

The No interest Loan Scheme (NILS) is a joint initiative between Good Shepherd Australia, NAB bank and the Australian Government to provide low-income Australians with interest-free loans. These loans can only be used for specific purposes and the funds are paid directly to the supplier or vendor.

NILS provides loans up to $2,000 for essential goods and services, or $3,000 for rental bonds and natural disaster costs. These loans have no interest, fees or charges, meaning you only repay what you borrow. The loan amount can be repaid over a maximum of 24 months. According to Anglicare, a typical fortnightly repayment is somewhere between $30-40.

Who is eligible for a no interest loan?

To be eligible for a NILS loan you must:

• Have a Health Care Card/Pensioner Card or earn less than $70,000 a year before tax ($100,000 for couples or people with dependants), or have experienced family or domestic violence in the last 10 years
• Have lived at your current address for at least three months
• Show that you can repay the loan.

What can no interest loans be used for?

According to the NILS website, you can use NILS loans for:

• Household items like appliances, whitegoods, and furniture

• Some medical procedures and dental services

• Computers or laptops

• Phone, tablet, or other electronic device (up to $1,000 limit)

• Education essentials like school fees, books, and uniforms

• Car repairs or registration

• Some other items as requested

• Bond on a new rental property (up to $3,000 limit)

• Natural disaster costs (up to $3,000 limit).

You can’t use NILS loans for:

• Food

• Rent

• Bills

• Cash

• Debts

NILS loans are not cash loans. If you’re approved for one, the NILS provider will generally pay the supplier for the good or service you need directly, or give you a cheque addressed to the supplier.

How do I apply for a no interest loan?

If you’re eligible for a no interest loan, the next step is to contact your nearest NILS provider to arrange an appointment. You can view a list of NILS providers on the Good Shepherd website or by calling 13 NILS (13 64 57).

At your appointment, you’ll need to provide your ID, details about your finances, information on any existing debts, and a quote or invoice for the item you’re planning to buy.

There are no credit checks during the application process. This means you won’t be refused a NILS loan if you have a bad credit history. The success of your application will instead depend on your income and expenses, the loan amount, and the repayment period.