The 5 minute post you should read before taking out any loan.


    If you’re a South African resident and thinking about applying for a loan, don’t go charging ahead and apply to just any old Tom, Dick or Harry. What you should be doing, even before you decide on which loan company to approach, is to compare the cheapest loan interest rates in South Africa by their type.

    Make the wonderful age of the internet information highway work for your wallet! Use your device, be it a smartphone, a tablet, a laptop or PC to carry out an online search. Using the internet is by far the quickest and easiest way of getting an honest at clear look at what’s available to you and for what price, in this case, it definitely pays to shop around.

    Different types of loans

    What sort of loan do you need? There are several cheap loan types from which to choose. For example, there are personal loans, installment loans, short term loans, and homeowner loans. The type of loan that best fits your requirements will be dependent on how much money you want to borrow, how long you need it for and how quickly you can comfortably afford to pay it back.

    Note that we use the word “comfortable.” There can be a tendency for people borrowing money to want to pay it back as soon as possible. No one likes being in debt any longer than they have to be. But if by offering to pay it back too quickly you then put yourself under financial pressure, it can backfire if you don’t have the cash available to make the repayment when you need it. The last thing you want is to enter a debt spiral

    So, whatever the type of loan you’re going to apply for, make sure you can pay it back within the agreed terms. This is what is meant when we talk about borrowing responsibly, and it’s the best principle on which to work.

    Check a cross-section of loan providers

    You will find no shortage of loan companies when you do your online search, all clamoring for your attention (and your interest payments). You should already have a good idea of the size of the loan you want and the period of time over which you can comfortably repay the loan (don’t be tempted to loan more cash just because they’re willing to provide it!)

    The next (And most arduous) task is to compare the providers to find which has the cheapest interest rate. Each company you encounter will likely have different terms and conditions, so it’s well worth spending some time going through their websites and checking out the fine print once you’ve whittled down to a few of the more competitive offers.

    There are plenty of websites that can help you in your comparison research such as and All it takes is about two minutes of your time to complete the inquiry form. You will then be provided with a selection of loans to consider.

    Pro tip: take these results with some caution. Just because a comparison website shows you a ‘first place’ result, this does not mean this loan offers the best deal. Remember these comparison websites exist to make money from you as referral traffic. Loan companies pay these comparison websites if they direct you to their website. Sometimes the ‘top result’ is simply the highest bidder for your click.

    Bank or loan company… or something else?

    The larger and longer your loan the more likely it is that going with a bank is the best option for you, it will pay you to do a little research into the five banks that are currently leading the trend of offering personal loans with low interest.

    Don’t forget that many banks offer credit card overdrafts that can allow you to ‘dip into’ emergency credit for a short period of time. While we don’t recommend making a habit of this, it can be extremely useful for emergency cash flow problems, provided you can pay back the minimum required cash value each month before the deadline (if you miss it the overdraft fees can end up costing you more than a payday loan). This leads us to our final nugget of advice…

    Tread carefully

    Comparing the best interest rates on loans is essential, but it is not the be-all or end-all of your obligations to protect yourself. You also need to ensure that any potential loan provider you are considering using is ‘NCR approved’. If you don’t, you could come unstuck and end up in a sticky situation with abusive organizations chasing you for payment or unilaterally upping the interest rate.


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