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Cash Advances are a last resort and should otherwise be avoided at all costs - if you're desperate, we explain how to get money while protecting yourself

Updated 23 January 2024

Cash Advances - A Warning

We take the view that a Cash Advance should only be taken out as a last resort.
If you need cash now and you are SURE you can repay the loan, a Cash Advance is one solution.
If you are uncertain about whether or not you can repay, missing a repayment on a Cash Advance will have serious financial consequences. It's normal for a $400 cash advance can grow into a $2,000 debt monster.
We believe you should only take a cash advance if you know you can repay.

Know this first - Cash Advance fees and obligations

Interest rates start at around 0.50% per day, but many cash advance interest rates can be higher than that. On top of this, there are fees and administration costs. In some cases, you'll also pay for every direct debit repayment
Cash Advance applications will show up on a credit report, meaning any further lenders will see that you needed fast cash.

Our guide covers:

Most Affordable Cash Advance Options

The summary below outlines everything you need to know about fees, interest rates, repayments and the overall cost of a Cash Advance. Our Cash Advance options are ordered from lowest to highest annual interest rate, indicating affordability.

Annual interest rate: 49%

Total repayment for $500 borrowed for 2 weeks: $541.96
Total repayment for $500 borrowed for 4 weeks: $$551.81
Total repayment for $1,000 borrowed for 2 weeks: $1091.81
Failed Payment/Default Fees: $30

Annual interest rate: 49.50% + Establishment Fee: up to $150

Total repayment for $500 borrowed for 2 weeks: $591.15
Total repayment for $500 borrowed for 4 weeks: $686.13
Total repayment for $1,000 borrowed for 2 weeks: Not permitted, maximum loan is $600
Failed Payment/Default Fees: $10

Annual interest rate: 49.95% + Establishment fee: $175 to $300

Total repayment for $1000 borrowed for 3 months: Up to $1,294.54
Total repayment for $5,000 borrowed for 9 months: Up to $6,424.86
Failed Payment/Default Fees: $ 1.80 per day in arrears

*Note that minimum loan terms is 4 weeks.

Other Cash Advance options, and their annual interest rates, are listed below:

Cashwise.co.nz: 49.45%
Savemybacon.co.nz: 49.95% (read our review)
Cashburst.co.nz: 49.95%
Paydayadvance.co.nz: 49.45%

Know this:

We have not linked any Cash Advance provider to MoneyHub as our view towards them is very negative, and
We do believe there are alternatives to a Cash Advance.
Our presentation of loan repayment calculations is for illustrative purposes only.

Important Information about Cash Advances

Understanding the Fees and Interest costs

The interest rates charged will vary hugely at any moment, and we recommend shopping around for a Cash Advance.
The more regular your repayments, the cheaper your loan will be. Making four payments of $100 each week is going to decrease your outstanding loan, and therefore incur much less interest expense compared to making a payment of $400 at the end of the month.
Lenders commonly charge around $40 if you pay late. Additionally, some lenders charge a late payment penalty interest rate of 0.25%-0.5% per day for the loan balance owed.

Specifically:

The higher the APR, the more expensive the Cash Advance
“Total repayment” is the original Cash Advance amount, interest costs and fees applied for a single payment made at the END of the term (2 or 4 weeks as stated).
“Early Repayment” means you are allowed to repay early, therefore saving you money.

Cash Advance - Frequently Asked Questions

What does a cash advance mean?

A cash advance is a short-term loan, designed to meet urgent money needs. A cash advance in almost all cases is loaned at a high interest rate and has a number of fees attached.

How much money can I get with a cash advance?

It depends on how much you apply for. Most Cash Advance companies will limit the amount to no more than $1,000. The minimum cash advance is usually around $200 or $250.

How fast will I receive a cash advance?

It depends on the Cash Advance company. Most transfer money within the same day a cash advance is approved, but check this before going ahead.

Does a cash advance hurt your credit score?

Yes - accepting a cash advance will be noted on your credit records, as will your repayment behaviour. If you repay it without any issues, your credit profile will, in most instances, improve. If you miss payments or default, your credit profile will be worse.

Is a cash advance a good idea?

It depends on your personal financial situation. While MoneyHub isn't a fan, everyone has personal circumstances which may mean a cash advance is necessary. Before applying for a cash advance, consider the alternatives.

Can cash advance companies take money from my account?

Yes - when you sign up for a cash advance, you will almost certainly approve a direct debit. This is how Cash Advance companies get their money back. If your bank balance is insufficient, the direct debit will be rejected, and in most cases, a fee will be added to your cash advance balance. The company will then attempt a direct debit the next day and continue until the payment is taken from your account.

How do I get the best cash advance?

The answer is simple - shop around and compare. Cash advance interest rates and default fees vary a lot, and on average you will pay $45 for every $100 borrowed in fees and interest. While fees are usually the same between Cash Advance companies, finding the best interest rate will help you save a lot of money.

When comparing, make sure you know:

The exact date you plan to repay the cash advance - the longer the term, the higher the cost.
What $ total you will repay (i.e. original loan value plus interest costs) if you repay on time at the date you expect to make full repayment
The late repayment fees and late payment penalty interest rate if you cannot pay. This is equally important, as the penalties can be hard to repay once incurred.
How often you'll receive statements, or whether you can check the balance you owe online. Knowing how much you owe will avoid confusion and help you pay it off faster.

What happens if I can't repay a Cash Advance?

Contact the Cash Advance company as soon as possible and be honest with them about the fact you are unlikely to be in a financial position to repay. You will be given the option to adjust the repayments to best suit your cashflows. Be aware that the longer the repayment term, the more interest charges you will have to pay.
If you have suffered illness, injury, loss of employment, the end of a relationship, or any other reasonable cause to be unable to make payments since taking the cash advance, you can apply under financial hardship for repayment holidays and/or interest caps.
If you do not contact your Cash Advance company and fail to make repayments, you will be chased and billed for the chasing, ranging from $10 per letter sent to $500 for a court order. Non-payment has the potential to cause a lot of hassle.

What is needed for a cash advance?

Generally, you need to meet the following requirements to qualify for a cash advance:

Be at least 18 years of age, living in New Zealand
Receive an after-tax income above $350-$400 per week, and be in permanent employment (as an employee). Your employer may be contacted to verify your employment. Be aware that Cash Advance companies will not disclose the nature of your application.
A proof of address, like a bank statement or utility bill.
You need a bank account, and your income needs to be shown to be deposited into that bank account.
You need a mobile phone and email address
You can receive a cash advance if you also receive a benefit, but you must still meet minimum weekly income thresholds.

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