Borrow hundreds of dollars for a fee of $ 5 to $ 10

The Commonwealth Bank is piloting a new program that will see participants dip into hundreds of dollars for a lump sum – provided they make their repayments on time.

Existing NetBank customers can apply to be part of CommBank AdvancePay, a trial offering customers up to $ 750 interest-free as long as they aren’t late on repayments.

“CommBank AdvancePay allows customers to access the money they expect to be paid, before their next payday,” said a spokesperson for the company.

“It will help clients manage their unexpected expenses without having to resort to more expensive types of short-term loans.”

Eligible customers could have access to $ 300 to $ 500 for an upfront fee of $ 5 or $ 501 to $ 750 for an upfront fee of $ 10.

And if they repay the amount on the due date, no interest is charged.

But if they fall behind on repayments, their account will be considered overdrawn and they will face excess debit interest charges. Currently, the interest rate is 14.9% per annum.

What are the details?

CBA customers interested in participating in the trial can apply through NetBank. A credit check will be performed and a response will be provided after one business day.

There are certain eligibility conditions. Interested parties will need to receive regular income in a CBA transaction account and it will only be an individual account.

Limits will be placed on the number of times AdvancePay can be viewed, the ABC said. It will also not be made available to customers in difficulty or late.

“Access to CommBank AdvancePay is restricted to eligible customers and available on a limited basis (not all payment cycles),” the spokesperson said.

“This offers consumers the protection that they don’t overburden themselves with additional short-term debt and avoid addiction.”

The bank plans to roll out AdvancePay to more eligible customers in the coming months – and it said other features could be added as well.

How’s it going?

AdvancePay offers certain advantages over own withdrawals from CBA. The bank’s overdraft facility charges $ 10 per month and calculates interest at 14.9%. In comparison, AdvancePay has a fee of $ 5 or $ 10, and there is an interest-free period – make the refunds on time, you won’t have to face any additional fees.

Buy Now Pay Later (BNPL) services like AfterPay and ZipPay typically don’t charge interest on purchases, but instead generate revenue by charging late fees and their merchant partners. But AdvancePay customers can use the money wherever they want, including paying bills and other essentials.

People’s finances are not one size fits all. Whether AdvancePay is a good option will depend on people’s personal financial circumstances, said Sally Tindall, Research Director at RateCity.

“Ultimately, there are pros and cons to most of these,” she said.

“Whichever platform they choose, they need to read the terms and conditions very carefully and make sure they pay back on time. Every payment option can trip you up in one form or another. “

Check out the detailed comparison below to see how AdvancePay differs from other credit services.

Provider Where can you use it? Repayment schedule Max credit Charges

(fees and interest)

Late payment fees Perform credit checks?
ABC Prepayment Anywhere – it’s like an overdraft on your bank account Refund on designated pay date Up to $ 750 Between $ 5 and $ 10 per month. Overdraft fees ($ 15 / day) and an interest rate of 14.9% will apply Yes
mypaynow.com.au Everywhere it is similar to an ATM (offers amounts of $ 50 or $ 100) Reimbursement on the day of the next salary Up to 25% of your next salary (up to $ 750) Fixed fee of 5% or $ 5 per $ 100 Nothing? Cannot access other funds if payment is missed No
BeforePay All over Flexible payments up to 4 weeks Up to $ 200 withdrawal. 5% transaction fee. No late fees.
Zip Pay All over Flexible repayment schedule provided you pay a minimum of $ 40 / month Up to $ 1000 $ 6 / month if you have money owed. Late fee of $ 5 after 21 days of non-payment of the minimum. YES
Bundll Wherever Mastercard is accepted. 2 weeks. Extend for up to 12 weeks for a fee. $ 1,000 for the basic offer No charge for the basic package. A 12 week plan costs 5% of the amount. $ 10 late fee, then the account is suspended No credit check for the standard bundll.
Hmm (little things) Affiliate retailers + majority of BPay billers. 5 or 10 bi-monthly payments $ 2,000 No charge if you make 5 bi-monthly payments.

Monthly fee of $ 8 if you make 10 bi-monthly repayments.

$ 6 for each late payment Can check the credit score, but will not affect the score
Afterpay Affiliate retailers only 4 payments over 6-8 weeks Up to $ 2000 See late fees. No registration fees or interest charged. Maximum charge of 25% or $ 68, whichever is lower. No

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