More than 110,000 people in Far North Queensland could be eligible to borrow money for essential goods and services, and pay no or low interest, through the region’s first Good Money community finance store.
The new Good Money store will open today on Mulgrave Road at Bungalow, and provides access to the No Interest Loan Scheme (NILS) and the StepUP low interest loan. These loans help people on low incomes with a better alternative to the high fees that come with cash loans and expensive consumer lease contracts.
People living on low incomes can use NILS to borrow up to $1,200 for essential goods and services such as furniture, whitegoods, computers, medical expenses and educational costs, and can make repayments over a 12 to 18 month period.
The Good Money store is part of an innovative partnership between Good Shepherd Microfinance, the Queensland Government, and NAB.
Good Shepherd Microfinance Chief Executive Officer, Adam Mooney, said there are many people in the Far North Queensland region who could be eligible for a NILS loan.
“Good Money will be providing services to individuals and families on low incomes who need a little bit of help to replace a broken washing machine, fix the car, or cover their children’s educational expenses,” said Mr Mooney.
“Sometimes people feel that they don’t have any alternative other than to take out a cash loan or a consumer lease to cover the cost of essential items like a new washing machine.
“A rental contract for a $550 washing machine could cost more than $2,000 over a four year period, but, with NILS, you won’t pay a single cent more than the value of that washing machine.”
Treasurer and Member for Mulgrave, the Hon Curtis Pitt MP, said the partnership between Good Shepherd Microfinance and the Palaszczuk Government will give Queenslanders in need a financial leg-up.
“We all hit tough times at some stage in our lives – a loss of a job, health issues, unexpected expenses, and billing piling up. It’s our goal to ensure that vulnerable Queenslanders are better prepared for financially stressful life events,” Mr Pitt said.
“We know there’s more than 112,000 people in the Far North Queensland region who would be eligible for a NILS loan through Good Money. That loan could buy a fridge or a washing machine for a family in need and help them to take control of their finances and make informed decisions.”
NAB Head of Financial Inclusion, Elliot Anderson, said this new Good Money store will help those who may not be able to take out a personal loan with a mainstream bank.
“We know people sometimes need help with a small amount of money to get them through a tough time.
“We’re committed to supporting initiatives like Good Money because it can be all that’s needed to help people avoid a cycle of unaffordable debt,” Mr Anderson said.
Since 2005, NAB has committed $130 million in microfinance loan capital, and provides around $24 million to finance NILS and StepUP loans each year.
“By providing an option for people on low incomes to help them avoid unaffordable debt, we can build financially resilient communities and help our nation prosper,” Mr Anderson said.
In addition to Good Money stores, the NILS program is offered through a network of community providers in around 140 locations across Queensland. Good Money shop fronts are already open in Victoria and South Australia.
Good Money stores also offer low-interest StepUP loans in partnership with NAB for up to $3,000, and information about Essentials by AAI – an insurance product, in partnership with Suncorp, designed specifically for people on low incomes.
- Two million Australians are experiencing severe levels of financial stress and another 10 million experience low levels of financial stress.
- 13.1 per cent of Australians would be unable to raise $2,000 within a week in an emergency.
- Payday lenders were estimated to generate between $670 million and $905 million in cash loans in 2015.
- Women are increasingly turning to payday lending. The number of women accessing payday loans increased by 110 per cent between 2005 and 2015, compared to industry growth of 80 per cent.