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Find and compare casual employee personal loans

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Loan term

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Product

Unsecured Personal Loan

Real Time Rating™

4.11

/ 5
Interest Rate

6.99

% p.a

Variable up to 18.99%

Comparison Rate*

7.91

% p.a

Variable up to 19.83%

Company
Monthly repayment

$926

36 months

Loan term

1 year to 7 years

Total repayments
Real Time Rating™

4.11

/ 5
Go to site
Total Repayments icon

Total repayments for a 3-year, $30,000 loan at 7.91% would be $33,342*. Terms from 1-7 years

special

Borrow from $5,000 to $55,000 with a 1 - 7 year flexible loan term with NAB. Plus enjoy no fees for extra repayments and no early exit fees.
Product

Unsecured Personal Loan Fixed

Real Time Rating™

4.02

/ 5
Interest Rate

6.99

% p.a

Fixed up to 18.99%

Comparison Rate*

7.91

% p.a

Fixed up to 19.83%

Company
Monthly repayment

$926

36 months

Loan term

1 year to 7 years

Total repayments
Real Time Rating™

4.02

/ 5
Go to site
Total Repayments icon

Total repayments for a 3-year, $30,000 loan at 7.91% would be $33,342*. Terms from 1-7 years

special

Borrow from $5,000 to $55,000 with a 1 - 7 year flexible loan term with NAB. Plus enjoy no fees for extra repayments and no early exit fees.

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What is a casual employee and how is it different from a part-time employee?

A casual employee does not have access to paid leave entitlements, including sick leave or holiday leave. Instead, they are entitled to a casual loading, which is an extra payment additional to their regular wages designed to compensate for the lack of paid leave.

Casual workers also generally do not have set or guaranteed working hours. The nature of their work means they will not be paid if they are away from work.

A part-time employee, on the other hand, is defined as someone who completes paid work of less than 38 hours per week but usually works regular hours each week. They are generally permanent employees or on a fixed-term contract. Like full-time employees, part-time employees are entitled to paid sick leave and annual leave.

Some 2.5 million Australians are casual employees. While it might be harder for these workers to secure a personal loan, they are available from some lenders. If you’re a casual employee considering to apply for a personal loan, make sure to do your research, check your credit score and be aware of the things that could influence your application.

Why is it harder to get a personal loan as a casual employee?

Most lenders typically prefer borrowers to be in full-time employment for a number of reasons:

  • Unstable hours and income – A casual employee’s working hours are not guaranteed and can change from week to week. Consequently, their income is unstable, regardless of their rate of pay. For example, while a casual worker might earn $1,000 in a good week, they might earn half of that the following week if their employer feels there is less work that needs to be done that week. Lenders generally value work stability as they see it as an indicator of one’s capacity to service the loan.
  • Lack of paid entitlements – A casual employee is not entitled to sick leave or annual leave. This means they will not be paid if they need to take time off work, whether it is for a holiday or because of other circumstances outside of their control. This can affect their ability to meet repayment obligations.

However, this doesn't necessarily mean casual employees can’t get a personal loan.

How important is your credit score when applying for a personal loan as a casual worker?

Borrowers with higher credit scores are typically looked at more favourably by lenders than borrowers with low credit scores. This is because credit scores provide lenders with an insight into your borrowing behaviour and allow them to assess the level of risk you may pose should they approve your application.

Casual workers with excellent credit scores tend to have more options available to them when searching for a personal loan as they are able to use their credit history to strengthen their application.

If your credit score has room for improvement, you might like to consider working towards boosting it before you apply for a personal loan.

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Who offers personal loans for casual employees?

Though casual employees could have a hard time getting a personal loan approved by a major bank or financial institution, many smaller banks and lenders may consider personal loans for casual employees who meet their eligibility criteria. While the specific criteria will depend on the lender, it could include the following:

  • A minimum age of 18.
  • A minimum annual income, which would vary with each lender.
  • Must be in regular employment.
  • A minimum period of continuous employment at current employer, generally between six and 12 months.
  • A good credit rating.
  • A minimum amount left over after regular expenses to see if the borrower can service repayments.

What do casual workers need to know about getting a personal loan?

The personal loan application process for casual employees is slightly distinct from full-time employees. Casual workers seeking a personal loan need to look out for several different points before signing on the dotted line.

  • Interest rates - As a casual employee is generally considered a higher-risk borrower, personal loans for casual employees might attract an interest rate that is higher than usual. This is to reduce the risk factor for the lender. For the borrower, it could mean higher weekly or monthly repayments. To be sure you are able to meet these repayments before committing to the loan, consider using RateCity’s Personal Loan calculator
  • Assessible income – Lenders know that the income of a casual employee can vary, and in some cases this fluctuation can be significant. To determine a casual employee’s income, rather than looking at their weekly or monthly earnings, lenders may instead assess their income over a three-month period and annualise this figure. For example, if you earned $9000 in the past three months, the lender may assume your annual income is $36,000 for the purpose of the assessment, even if you may potentially earn more or less than $9,000 in the next three months.
  • Income consistency – On the flip side, if you can prove to the lender that your income is fairly consistent despite being a casual employee, you could potentially have a higher chance of getting approved and your borrowing power may be strengthened. While casual employees have no guaranteed working hours, some could be in a situation where they consistently work 38 hours a week, just like a full-time employee. In this case, the lender may view this favourably. 
  • Essential documents for casual employees - As with all personal loans, casual employees applying for a personal loan will have to provide the lender with various documents to prove their eligibility for the loan. These will vary with the lender, and could include the following:
    • Proof of identity such as a passport or driver’s licence.
    • Proof of income such as recent pay slips and tax returns/notices of assessment.
    • Proof of financial status such as bank statements and credit card statements.

For advice specific to your personal circumstances, consider reaching out to a financial adviser or personal loan broker.

What is a personal loan?

A personal loan sits somewhere between a home loan and a credit card loan. Unlike with a credit card, you need to sign a formal contract to access a personal loan. However, the process is easier and faster than taking out a mortgage.

Loan sizes typically range from several hundred dollars to tens of thousands of dollars, while loan terms usually run from one to five years. Personal loans are generally used to consolidate debts, pay emergency bills or fund one-off expenses like holidays.

Where can I get a personal loan?

The Australian personal loans market contains dozens of lenders offering several hundred different products. Personal loans are available through a range of institutions, including:

There are three main ways to access personal loans. You can go through a comparison website, such as RateCity. You can use a finance broker. Or you can directly contact the lender.

How are personal loans regulated?

Personal lenders in Australia are regulated by ASIC (the Australian Securities & Investments Commission) and must follow responsible lending rules. That means they can’t lend money without making “reasonable inquiries” about a borrower’s financial situation and ensuring the loan is “not unsuitable” for them.

What are the pros and cons of personal loans?

The advantages of personal loans are that they’re easier to obtain than mortgages and usually have lower interest rates than credit cards.

One disadvantage with personal loans is that you have to go through a formal application process, unlike when you borrow money on your credit card. Another disadvantage is that you’ll be charged a higher interest rate than if you borrowed the money as part of a mortgage.

How long do personal loans take?

Depending on the lender, some personal loan applications can be approved in as little as one hour, or you may need to wait until the next business day. If approved, you may receive your money on the same day, the next business day, or within the week.

This article was reviewed by Personal Finance Editor Alex Ritchie before it was published as part of RateCity's Fact Check process.

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