Have you been thinking of applying for a personal loan but lazy to drag yourself to the bank to do the whole loan application process?

    If so then you are in luck as several registered online lenders operate online, offering an efficient financial service.

    This article will list some of the most reputable online personal loans. We will start by covering all the necessary information you will need to note before applying for a personal loan online.

    This will help you understand what you will be getting yourself into and save you from considering scammer’s loans.

    What is an online personal loan?

    A personal loan is money borrowed from a credit provider and can be applied for to cover any costs, it can be for car repair, medical bills, weddings, or any other emergencies.

    Personal loans are unsecured credit solutions. The bank or lender grants you a loan based on your ability to pay it back.

    Online personal loans are offered by various lenders, they are available through traditional banks, credit unions, and online lenders.

    Online loans are highly recommended if you would like to borrow money urgently or if you want to try and qualify for more competitive interest rates and terms that are better than what is offered by most traditional lenders.

    They are the most convenient as everything is done online, from filling in the application to submission of documents. Everything gets done while you are sitting comfortably at home.

    Most online lenders offer low-interest rates, so if you have a great credit record and an outstanding financial profile your chances of being approved are very high.

    Each loan has its perks and terms so you will have to be sure of everything before your loan is approved, and money is deposited into your account.

    Usually, a fixed amount paid in fixed monthly instalments. Repayment terms range between 12 to 72 months.

    Credit providers look at several factors to determine if you qualify for the loan. They look at your credit score, income, affordability, expenses and so on.

    If you have a good credit score, you’re guaranteed the lowest interest rate on your loan application.

    It gets interesting.

    If you can’t afford an unsecured personal loan, the lender might offer you a secured loan.

    With secured loans, you will be required to secure your loan with collateral such as a vehicle or house.

    Should you default or fail to pay back the loan under agreed terms, your asset will be sold to recover the loan money.

    Why take out personal loans?

    Depending on your current situation.

    South Africans take out personal loans to pay off credit cards, consolidate debts, pay children school fees, buy cars, and many other things.

    The benefit of taking out the loan is that it comes with fixed interests. This helps you plan your monthly budget and keep track of instalments.

    And your monthly instalments will be affordable and easy to manage.

    Personal loans could help you build a credit history. You might take a small cash loan just to have a credit record in your name.


    People don’t really need loans, but life happens, and we run out of funds sometimes. Consumers are advised to only borrow money when it’s absolutely necessary.

    Use the money to advance yourself – invest in yourself. You can spend the money to acquire a new set of skills that’ll advance your career.

    Things to consider before applying for a loan online

    It is advisable to first shop around before applying for any loan, and see which lender has the best offer that caters to all your needs.

    A loan will definitely influence your credit score and how you pay it back will have an impact on your credit history. So, before taking out a loan, know your capabilities of handling the payment.

    Know the benefits of the loan you are taking and remember interest rates might differ from each lender to the other.

    Be alert, there are a lot of online scams, be careful not to go for a lender that is not registered with the National Credit Regulator.

    How to apply for a personal loan

    Applying for a personal loan has become simpler nowadays than ever before.

    We have so many online lenders and loan brokers in South Africa. They help connect loan applications with credit providers.

    You can apply for the loan online, at the branch, or via telephone.

    And of course, it’ll be easier for you to get a loan from your bank. They already have a good understanding of your income and spending.

    BETTER – the bank might offer you the best solution for your current situation.

    Borrow wisely.

    Choose a personal loan that you can afford to repay with more flexibility. Shop around and compare loans from different lenders and calculate your monthly expenses. Some lenders can do this on your behalf but it’s best if you determine your own affordability.

    You will be required to meet certain criteria to qualify for the loan. The bank doesn’t want to give money to a minor – right?

    You might be required to bring the following:

    • Identification book or Smart ID
    • Recent Pay slips
    • Recent banking statements
    • Proof of residential address

    How to spend your personal loan

    Consumers are always advised to borrow money only when it’s necessary. Being responsible automatically leads to spending money wisely, to advance your life.

    Banks usually don’t a cap on how you can spend the money you’ve borrowed, so you can use the loan money however you feel fit. Perhaps, you wanted to buy a good quality second-hand car or go on holiday – DO IT.

    One most wise way to spend a personal loan is to consolidate all your debt.

    Make personal loans good credit.

    What’s the Average Personal Loan Interest Rate in South Africa?

    Many factors determine the interest rate banks charge on your personal loan application.

    The most important factor of them all is your current credit score rating, how well have you been paying your previous debt, and what’s your current credit.

    Based on the above calculations, the appropriate interest rate will be charged for the loan amount you want to apply for.

    Here’s an illustration of the average loan interest rate as determined by the customer’s credit score.

    720 – 850 10.30%–12.50%

    690 – 719 = 13.50%–15.50%

    630 – 689 = 17.80%–19.90%

    300 – 629 = 28.50%–32.00%

    So on average, a lot of clients fall between the 630 – 689 ratings, which get them personal loans at the least affordable interest rate. And the average loan interest rate is 17.5% for unsecured personal loans in South Africa.

    Even better, we’ve tried many popular banks in South Africa by using their online calculators and most of them start their interest rate at 18%.

    How to improve your chances of getting a loan

    To qualify for good credit, lenders want to know if you could afford the loan.

    The easiest way to improving your chances of getting a loan is to keep your finances in order. Keep up with your monthly instalments and debit orders.

    This will increase your credit score and help you secure good credit for your most important expense.

    It’s against the law for banks to over indebt consumers, so you’ll always get a loan you can afford.

    You need to avoid making multiple loan applications to various lenders, it always affects your rating negatively.

    Are online loans safe?

    Yes, online loans are safe. There are trustworthy online loan companies, they have measures in place that protect the business and most importantly their clients.

    You can verify online lenders by:

    • Checking for a physical address – the business might fully operate online but, a legit company will have a physical address on their address of where their offices are.
    • Looking for reviews – Reviews are the best thing that has ever happened to online shopping. The complaints will help you decide if you want to go for that lender or not.
    • Searching for third party verification
    • Noting lead gatherers with no real loan offers – Some companies that portray themselves as lenders are in the business of gathering information and selling it to other lenders in the country.

    Watch out for loan scams

    The internet has made our lives easy in the world.

    We can apply for personal loans in the comfort of our homes. We can get instant decisions and money in our bank accounts within minutes.

    But, within the pool of trusted lenders online, there are also criminals.

    Loan scams come in many forms. Some claim to approve your loan with bad credit.

    You must avoid lenders that claim to approve loans without checking your credit profile.

    Those are reckless and will steal your hard-earned money.

    You must never pay anyone to get a loan – it wouldn’t make sense.

    Here are some of the red flags that you should look out for:

    • They state that you will be approved no matter how bad your credit history is.
    • Some will ask for payment upfront.
    • They pressurise you to accept the loan.
    • There isn’t that much information about them online.
    • You can’t find them on the list of registered lenders.

    You can read more: 10 Signs of a Personal Loan Scam in South Africa

    List of Online Personal Loans

    1. 1Life Loans

    1Life Personal Loans is a registered and authorised credit provider. The company complies with the National Credit Act, which means that you will be approved for a loan that you can repay depending on your credit history and record.

    They offer loans of up to R150 000 and you can qualify if you earn R2 000 or more. Their application is quick and easy, you will be notified of the outcome within seconds and if approved, money will be sent to your account within 24 hours.

    It will be up to you to choose the fixed repayment term that suits you, from 12 to 60 months.

    To apply for a 1Life Personal Loan you must:

    • Be 18 years or older
    • Have a valid SA ID or driver’s license
    • Have a bank account
    • Be employed and earn R2 000 or more per month
    • You will be required to provide proof of income

    2. Bayport Online Loans

    Bayport Financial Services offer online personal loans from R1 000 to R250 000 which can be paid back from 6 months to 84 months. You can check if you qualify for a personal loan by using their loan calculator.

    With Bayport, your loan will be insured, in the event of death, disability or retrenchment.

    Their application process is simple and convenient, you will have to first register and activate your account. To apply you will need to upload the following documents:

    • South African ID
    • Proof of residence not older than 3 months
    • Latest payslip
    • Last 3 months’ bank statements

    You will get a fixed interest rate which will be personalised according to your risk profile.

    3. DirectAxis Loans

    DirectAxis offers a secure and easy-to-follow online loan application process. After filing in the online form, feedback will be given quickly, and money will be deposited into your account within 48 hours of approval.

    Payment can be made from 24 months up to 6 years and the interest rate is fixed for the full term of the loan. The maximum interest rate with regards to a DirectAxis Personal Loan is 26.5% per annum (compounded monthly).

    To apply you will need to provide the following:

    • A copy of your ID
    • A recent proof of address
    • 3-month bank statement or payslip

    4. FNB Personal Loan

    First National Bank is one of the banks in South Africa that offers online loans. You can apply for a personal loan online in just a few easy steps.

    FNB offers personalised loans of up to R300 000 which can be approved in minutes if you qualify. They have credit solution for everyone that comes with personalised interest rates.

    Qualifying Criteria:

    • You must be 18 years or older
    • Be permanently employed or self-employed
    • Be a permanent SA resident
    • Your salary must be directly paid into your bank account

    5. Sanlam Personal Loans

    Sanlam has credit solutions for all your unexpected expenses or what you require the funds for. They have fixed interest rate loans that can be applied for easily online.

    With Sanlam, you can get a loan of up to R300 00 at a fixed interest rate which will be determined by your risk profile.

    The loan repayment term ranges from 24 to 72 months, with an interest rate between 20.25% and 24.50% per annum (compounded monthly).

    Here are some of the online loans you can check and apply for online:

    While there are bad loan lenders, the majority of online loans are safe. You will have to properly do your research to verify a lender and identify any suspicious trends.

    Online loans are mostly flexible with reasonable interest rates. If you are still trying to get back on your feet and your credit history is bad, don’t worry because there are online loans that cater to people with bad credit.



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