Short term loans South Africa have become an essential financial tool for many South Africans facing unexpected expenses or temporary cash shortages. These loans, typically characterized by their brief repayment periods, offer quick access to funds to help individuals bridge financial gaps.
These top 11 short term loans in South Africa are accessible to a wide range of applicants, including those with lower credit scores, as lenders consider various factors during the approval process. With shorter repayment periods, borrowers also pay less interest compared to long-term loans, contributing to better financial planning. Moreover, responsibly repaying short term loans can boost a borrower’s credit score, opening up better credit opportunities in the future.
What is a Short Term Loan South Africa?
A Short-Term Loan offers almost instant cash to borrowers to be repaid typically within a number of days or months. Most of the time, this type of loan is used for an unexpected expense that you have not budgeted for but can pay back relatively quickly, such as car repairs, home renovations or other pressing personal daily needs. Short term Loans especially payday loans are regarded as the most expensive type of loan that you can apply for as the interest rates could be high.
Payday loans, a variant of short term loans South Africa is a situation where a small cash loan is paid out and you are expected to pay back at your next paycheck. Some creditors however may allow a longer repayment period.
An asset-based loan, could also be a category of short term loan where you offer one of your assets to the creditor and you are given a loan to the value of the asset. If you default on payment, the creditor can gain possession of the asset to sell.
Top 11 Best Short Term Loans South Africa 2023
The best short term loans South Africa to help you access urgent cash during emergencies and unexpected bills are Arcadia Finance, Loansfind, Capitec, African Bank, DirectAxis, and Bayport Financial Services. If you meet their eligibility criteria and qualify, you will be approved seamlessly and can get cash disbursement same day. The loan application has flexible repayment term and cheaper interest rates.
1. Arcadia Finance
Arcadia Finance is one of the top financial lending institution providing the best short term loans South Africa up to R250 000. The loan application believes there could come a time when you face a sudden, unexpected lack of funds. Maybe your car broke down or some other small crisis caught you short of cash. Whatever the reason, a short-term loan could be the answer to your problem, and Arcadia Finance low interest rates, quick loan offers and free application without commitment is one of your best choices.
2. Loansfind
Loansfind is a well known short term loan South Africa online platform offering same-day approval for up to R80,000 at an affordable low-interest rate starting from 19.5% and a flexible repayment term of up to 24 months. This is regarded as the most popular form of consumer credit in South Africa.
3. ABSA
ABSA, a subsidiary of the Barclays Africa Group, offers a wide range of financial products and services, including retail and business banking, as well as wealth management. They provide various short term loans South Africa options, including personal, express, and instant loans, making quick cash accessible. ABSA also extends its services to home and vehicle finance, student loans, and debt consolidation products.
The eligibility criteria include being a South African citizen aged 18 or older, having a bank account with regular income deposits, and earning a minimum monthly income of R2,000. Loan amounts range from R3,000 to R350,000, with interest rates capped at an APR of 17.5%, and repayment terms spanning from 12 to 84 months. It’s our first pick on our top 8 short term loans in South Africa.
4. Capitec
Capitec is renowned for its innovative banking solutions and one of the best organizations offering short term loans South Africa. It facilitates a user-friendly remote banking, cash at tills, and ATM transactions, which have significantly enhanced customer convenience. The bank extends its services to encompass credit facilities, home loans, and insurance products, offering some of the lowest interest rates on personal loans in the country.
Prospective customers can apply for these services either by visiting Capitec branches or utilizing their online platform. To qualify, individuals should be at least 18 years old, residing in South Africa, and maintain an active bank account where their monthly income is regularly deposited. Loan amounts range from R1,000 to R250,000, with interest rates capped at 12.9%. For a comprehensive overview of their loan interest rates, visit their official website. Repayment terms vary, spanning from 30 days to 84 months, providing flexibility to borrowers.
5. FNB
To access short term loans South Africa or cheap short term personal cash loans from FNB, applicants can conveniently complete an online application form or utilize the FNB Banking app. FNB offers the flexibility of loan requests through mobile banking (or landline telephone (0861 40 40 40).
Eligibility criteria include being a permanent resident of South Africa aged 18 to 64, permanent employment or self-employment, ownership of a bank account where monthly income is deposited, and successfully passing their affordability and credit assessment. Loanable amounts range from R1,000 to R200,000, featuring competitive interest rates with a lending rate as of 2018 at 10%, making it one of South Africa’s most attractive options for personal loans.
6. African Bank
African Bank also offers short term loans South Africa to whoever is in need of it once the applicant meets the eligibility criteria. The bank offers a wide range of financial services, including personal loans, investments, credit, and insurance products, to retail customers. Eligibility requirements encompass being a South African resident aged 18 or older, maintaining stable employment with the same employer for at least six months, and possessing an active bank account into which monthly income is consistently deposited.
The loanable amount varies from R2,500 to R200,000, with corresponding annual percentage rates (APR) ranging from 15% to 27.75%, contingent on individual credit ratings. African Bank accommodates diverse financial circumstances with repayment terms spanning from 7 to 72 months, ensuring flexibility to suit borrowers’ needs and preferences.
7. DirectAxis
DirectAxiz, a proud member of the esteemed FirstRand Group and a leading banking institution in Africa, specializes in offering short term loans South Africa and insurance solutions to the retail market. Leveraging their financial expertise, they provide some of the finest personal loan options available in South Africa.
Eligibility requirements necessitate South African residency, a minimum age of 18 years, and consistent receipt of a monthly income of at least R5,000, alongside an active bank account where regular salary deposits are made.
Loan amounts are flexible, ranging from R5,000 to R150,000, with interest rates capped at 27.5%, although personalized rates may be lower based on individual financial profiles. Tailored to meet diverse needs, DirectAxis offers repayment periods spanning from 24 to 72 months, ensuring borrowers have options that align with their financial circumstances.
8. RCS
RCS offers a diverse range of retail financial products ranging from short term loans, short term loans bad credit, short term loans 6 months, cheap short term loans, and quick short term loans as well. While not necessarily the most cost-effective option in the South African lending landscape, RCS stands out for its rapid loan approval process, often disbursing requested funds within a mere 24 hours of application submission.
Eligibility criteria mandate a minimum age of 18 years, a monthly income of at least R2,000, and an active bank account into which regular salary deposits are made. Loan amounts range from R1,000 to R150,000, with interest rates capped at 27.5%. For repayment, borrowers can choose flexible terms spanning from 12 to 60 months, accommodating varying financial circumstances.
9. Sanlam
Sanlam boasts a track record of excellence in the provision of financial products and services. To qualify, applicants must be South African citizens aged 18 or older, furnish evidence of income via three months’ worth of payslips or bank statements, and maintain an active bank account where their monthly salary is deposited.
Sanlam extends loan amounts ranging from R5,000 to R200,000, with interest rates spanning from 21.9% to 27.5% per month, while the repayment period spans 24 to 60 months, offering flexibility to borrowers in managing their finances. It’s our seventh pick on our top 8 short term loans in South Africa.
10. Bayport Financial Services
Established in 2004, Bayport Financial Services has been a solid provider of short term loans in South Africa, as their rapid ascent has positioned them among the nation’s premier providers of unsecured credit and top personal loan choices.
Offering an array of loan and insurance products accessible to clients across the country, Bayport requires applicants to be at least 18 years old, maintain a tenure of at least six months with their current employer at the time of application, and hold an active bank account where their monthly salary is deposited. Loan amounts range from R1,000 to R150,000, with fixed interest rates contingent upon individual financial profiles, and flexible repayment terms spanning from 6 to 60 months.
11. Letsatsi Finance and Loan
Letsatsi Finance and Loan (Pty) Ltd is an Authorised Financial Services (43543) and Registered Credit Provider (NCRCP895) that offers the perfect solution for large unexpected expenses and quick short term loans South Africa.
If you need a small or medium amount of money in a hurry, then a one-month loan from Letsatsi Finance and Loan could be the answer. The loan platform gives borrowers access to short term loan offerings between 2 to 6 month repayment period and loan amount between R500 to R7 000.
What is short term loan?
Short term loan serves as a valuable financial tool for many South Africans encountering unexpected expenses or temporary cash shortages. These loans are characterized by their brief repayment periods, offering quick access to funds to help individuals bridge financial gaps.
Unlike long-term loans, short term loans, such as those offered by top financial institutions like ABSA, Capitec, and FNB, have shorter repayment periods, resulting in lower interest payments and aiding in more effective financial planning. Moreover, these loans are accessible to a wide range of applicants, including those with lower credit scores, as lenders consider various factors during the approval process.
Do short term loans affect credit rating?
Short term loans can indeed impact your credit rating, and the effect can be both positive and negative. When managed responsibly, repaying short term loans on time can boost your credit score, demonstrating your ability to meet financial commitments.
This positive credit history can open doors to better credit opportunities in the future. However, missing payments or defaulting on short term loans can have adverse consequences, leading to a decline in your credit rating. It’s crucial to borrow responsibly, ensuring that you can comfortably meet repayment obligations, to harness the potential credit-building benefits of short term loans without harming your creditworthiness.
Do short term loans have higher interest rates?
Yes, short term loans often come with higher interest rates compared to long-term loans. These top 8 short term loans in South Africa, while offering quick access to funds and flexibility, typically have interest rates that vary, with some reaching APRs as high as 27.75%.
This is because lenders charge higher rates to compensate for the shorter repayment periods and to cover the associated risks. However, despite the higher interest costs, borrowers often find these loans appealing for their accessibility, quick approval, and the ability to address immediate financial needs, ultimately contributing to better financial planning when used responsibly.
Do short term loans affect your credit rating?
Short term loans in South Africa, while providing quick financial relief, can indeed impact your credit rating. These loans, characterized by brief repayment periods, offer accessibility to funds for addressing immediate needs. Responsible repayment can positively influence your credit score, demonstrating your ability to manage and fulfill financial commitments. However, failing to meet repayment deadlines or defaulting on short term loans can have adverse consequences, potentially lowering your credit score.
Do short term loans help credit?
Short term loans in South Africa can indeed help improve one’s credit score. These loans, characterized by their brief repayment periods and accessibility to a wide range of applicants, provide a valuable financial tool for individuals facing unexpected expenses or temporary cash shortages. By responsibly repaying these loans, borrowers can demonstrate their ability to manage credit effectively, which can positively impact their credit history. A history of on-time payments can lead to an improved credit score, opening up better credit opportunities in the future.
Conclusion
In conclusion, short term loans in South Africa offer a lifeline to individuals facing unexpected financial challenges or temporary cash shortages. These loans, characterized by their brief repayment periods, grant quick access to funds and are accessible to a wide range of applicants, including those with lower credit scores. Beyond addressing immediate financial needs, short term loans can also contribute to better financial planning, as their shorter repayment periods mean borrowers pay less interest compared to long-term loans.
