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Personal loan interest rates: August 2022

By Peter Marshall ·

Over the last month, personal loan interest rates have continued increasing among both banks and non-bank lenders. 

With numerous rounds of RBA (Reserve Bank of Australia) rate increases to the Australian cash rate – we expect to see personal loan interest rates continue to rise in 2022. Australians wanting to lock in a more competitive fixed personal loan rate might want to act soon before they get even higher.

Last month we saw big four bank ANZ introduce risk-based pricing to its personal loan products. We’ve also seen the number of green personal loans on offer continuing to increase as more lenders seek to support Australians wanting to fund environmentally-friendly options.

Personal loan interest rate highlights: August 2022

Let's highlight some of the top personal loan interest rates in the Mozo database for August 2022:

Lowest variable rate unsecured personal loan:

• A tie between Community First Credit Union's Green Loan (up to 10 years, Variable, Unsecured) - 3.99% p.a. (4.99% p.a. comparison rate*), and its Home Improvement Loan (up to 10 years, Variable, Unsecured) - 3.99% p.a. (4.99% p.a. comparison rate*)

Lowest fixed rate unsecured personal loan:

Harmoney’s personal Loan (Unsecured, Fixed) - 5.35% p.a. (6.15% p.a. comparison rate*)

Lowest variable rate secured personal loan:

Transport Mutual Credit Union's GreenRoad Hybrid & Electric Cars (Variable) - 4.74% p.a. (5.04% p.a. comparison rate*)

Lowest fixed rate secured personal loan: 

This was a tie between the following lenders offering the lowest fixed, secured rate of 4.99% p.a.

Bendigo Bank's Green Personal Loan (Fixed) - 4.99% p.a. (5.70% p.a. comparison rate*).

Credit Union SA's Online-only Special Fixed Rate Personal Loan (Secured) - 4.99% p.a. (5.34% p.a. comparison rate*)

Looking to see how interest rates are performing across other banking products? Check out our latest monthly snapshots for Home Loan Interest Rates, Car Loan Interest Rates, Savings Accounts Interest Rates or Term Deposit Interest Rates.

Picture of Peter Marshall
Peter Marshall
Banking expert

Peter has been working in the Australian banking and finance industry for over 20 years and oversees Mozo’s extensive product database. He is regularly sought out for his expert commentary and analysis on banking and interest rates trends by print, radio and TV media.

Latest personal loan interest rates on Mozo - last updated 17 August 2022

Search promoted personal loans below or do a full Mozo database search . Advertiser disclosure
  • Mozo Expert Choice Badge
    Unsecured Personal Loan

    Fixed

    interest rate
    comparison rate
    Monthly repayment
    6.75% p.a.to 19.95% p.a.
    6.75% p.a.to 19.95% p.a.based on $30,000
    over 5 years

    Borrow up to $50,000 unsecured. Perfect if you earn more than $22,100 p.a. and have good to excellent credit. Back to back winner of Mozo’s Experts Choice Unsecured Personal Loan Award, 2021 & 2022^.

    Repayment terms from 2 years to 7 years. Representative example: a 5 year $30,000 loan at 6.75% would cost $35,430.23 including fees.

    Compare
    Details
  • Unsecured Personal Loan

    Fixed

    interest rate
    comparison rate
    Monthly repayment
    8.20% p.a.to 18.45% p.a.
    9.04% p.a.to 18.87% p.a.based on $30,000
    over 5 years

    Wisr offers personal loans for any worthwhile purpose, tailored to your credit score to ensure you’re getting a fair deal. Plus, no ongoing or early exit fees. Loans from $5,000 to $64,000. Terms of either 3, 5 or 7 years. $595 establishment fee. Eligibility criteria applies.

    Repayment terms from 3 years to 5 years. Representative example: a 5 year $30,000 loan at 8.20% would cost $37,265.04 including fees.

    Compare
    Details
  • Personal Loan

    Variable, Unsecured

    interest rate
    comparison rate
    Monthly repayment
    6.99% p.a.to 18.99% p.a.
    7.91% p.a.to 19.83% p.a.based on $30,000
    over 5 years

    Borrow up to $55,000 for that dream kitchen renovation or holiday of a lifetime and pay no exit fees if you decide to pay out your loan early or make extra repayments. Majority of NAB borrowers will receive the headline rate of 12.69%.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 6.99% would cost $36,383.67 including fees.

    Compare
    Details
  • Home Improvement Loan

    Fixed, Unsecured

    interest rate
    comparison rate
    Monthly repayment
    6.99% p.a.
    7.62% p.a.based on $30,000
    over 5 years

    Handypay offers flexible home improvement loans for Excellent Credit or better. Handypay is a specialist home improvement plan provider and offers loans up to $75,000.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 6.99% would cost $35,883.67 including fees.

    Compare
    Details
  • Low Rate Personal Loan

    Very Good Credit

    interest rate
    comparison rate
    Monthly repayment
    8.49% p.a.to 11.19% p.a.
    8.85% p.a.to 11.56% p.a.based on $30,000
    over 5 years

    Competitive low rates on loans up to $75,000 for excellent credit. Free extra repayments. Fee-free redraw facility. Winner of Mozo's Experts Choice Unsecured Personal Loan 2021 award^.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 8.49% would cost $37,171.08 including fees.

    Compare
    Details
  • Green Loan

    interest rate
    comparison rate
    Monthly repayment
    6.99% p.a.
    7.62% p.a.based on $30,000
    over 5 years

    Handypay offer flexible green loans up to $75,000 for Excellent Credit or better. Handypay is a specialist home improvement plan provider.

    Repayment terms from 1 year to 10 years. Representative example: a 5 year $30,000 loan at 6.99% would cost $35,883.67 including fees.

    Compare
    Details
Search now

^See information about the Mozo Experts Choice Personal loans Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.

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Personal loan interest rate resources

Reviews, news, tips and guides to help find the best personal loan for you.

How are personal loan interest rates calculated? 

Personal loan lenders set their own interest rates on their products; however, they're influenced by the official cash rate set by the Reserve Bank of Australia (RBA). 

After its monthly meeting, the RBA will announce whether they have made changes to the official cash rate. This could be increasing, decreasing or keeping it the same. There are a number of things that influence the shift of the rate, including spending and employment stats, as well as inflation and economic growth. In order to slow borrowing, economic activity and inflation, the RBA will make the rate higher. Alternatively, however, if they want to stimulate these things, they will lower it. 

Generally speaking, Australian lenders adjust interest rates after the RBA makes its announcement.

What types of personal loan interest rates are there? 

There are two types of personal loan interest rates: variable or fixed. The rate can influence how much your repayments are and ultimately how much the loan will cost you overall. Plus, there is also the comparison rate to be aware of, which encompasses not only the headline rate but also fees.

Read on for a deeper look into how each type of interest rate works. 

Variable rates:

One option when choosing a personal loan is a variable rate. This type of rate can change over the life of the loan and move up or down as the market moves. Where variable rates are handy is if rates are slashed, as you’ll end up paying less in interest than when you took out the loan. But it can also work in the opposite way. If rates are hiked up, you’ll face a larger interest repayment than you did before. 

The bonus of a variable personal loan is that you are unlikely to be charged an early repayment penalty if you pay off your loan ahead of schedule. So a variable option may be right for you if you are okay with potential changes to your rate and plan to make additional repayments.  

Fixed rates:

Alternatively, you could go for a fixed rate instead. This is where you get the same interest rate over the whole duration of the loan. So, if you are consistent with your regular repayments, you’ll end up paying the same amount each week, fortnight or month. 

The benefit here is that if interest rates are increased, your loan won’t be affected as you’ve locked in your rate. On the other hand, it also means that if rates go down, yours won’t change either. And it’s also important to note that, unlike variable rate personal loans, lenders are more likely to charge an early repayment fee on fixed options.  

What is a comparison rate?

When weighing up different personal loan options, it’s crucial to consider the comparison rate. Unlike the headline rate, it combines both the interest and fees you will pay as well. 


In accordance with the National Credit Code, it is a requirement that Aussie lenders advertise comparison rates on their products. This is because it is a more accurate representation of what the loan might actually cost rather than the headline rate alone. In most cases, the comparison rate is higher as the addition of fees and charges on the loan make it more costly to the customer. So it’s important that when looking at potential personal loan products, you ensure the headline rate and comparison rate aren’t significantly different. Because if they are, it means you’ll likely face a number of hefty costs on the loan. 

Want a hand to start comparing? Check out the Mozo personal loan comparison calculator

Online lenders vs banks: how do their interest rates compare? 

When it comes to online lenders versus banks, there’s not much difference in interest rates. Instead, you should consider the way you plan to manage your loan and what your preferences are. 

On the one hand, if you like traditional forms of banking, including the option to head to your local branch, choosing a personal loan from a bank may be better for you. However, if you don’t mind managing your loan online, weigh up both banks and digital lenders to see who offers the most competitive rates. 

How does my credit score affect the interest rate of my personal loan? 

More and more Australian personal loan lenders are offering customers customised interest rates based on their credit score. This is called risk-based pricing, where interest rates are determined in accordance with how likely a lender thinks the borrower is to default on their loan. 


How do you know if a loan offers risk-based pricing? Well, instead of advertising one rate, they’ll be a minimum and maximum rate on offer. Based on a customer’s credit history, a lender is able to offer a rate that sits anywhere between the two numbers advertised. So, to put it simply, those with excellent credit will receive a low rate, and those with poor credit will receive a high rate. 

While this type of pricing model may sound like it only benefits those with a good credit score, it actually opens up more opportunities for those with bad credit, too. As in some cases, lenders that don’t have risk-based pricing may deny them the loan altogether. 

How can I get the best interest rate on a personal loan? 

There’s a range of different things to consider when choosing the best personal loan interest rate for you, along with a number of lenders to weigh up. So make sure you shop around and read the fine print so that the loan you sign up for fits in your budget. 

A great starting point is right here at Mozo! We have a range of handy tools to help you: 

Plus, if you are after more on loan products in general, you can check out our loans page or more interest rate guides.

Picture of Peter Marshall
Peter Marshall
Banking expert

Peter Marshall has been working in the Australian banking and finance industry for over 20 years and oversees Mozo’s extensive product database. He is regularly sought out for his expert commentary and analysis on banking and interest rates trends by print, radio and TV media.

FAQs about personal loan interest rates

Should I choose a personal loan with a fixed or variable rate? 

There is no right or wrong choice when it comes to decking between a fixed or variable rate. Consider your financial situation and figure out what you think will suit it best. Refer to the breakdown of variable and fixed rates above for more information. 

How are personal loan repayments calculated?

A number of things affect how your personal loan repayment is calculated. These include the interest rate you receive, your repayment schedule (weekly, fortnightly or monthly) and the length of your loan. 

Simply put, your repayment is made up of two parts: your principal, which is what you borrowed, and interest, which is what the bank charges for lending you the money. Initially, a larger amount of your repayment goes towards paying interest but as your principal lessens the amount of interest you pay reduces. So as your loan comes to an end, most of your repayment goes towards the principal amount, not interest. 

For the specifics on how much your interest might be on a personal loan you’re considering, take a look at our personal loan repayments calculator

What are some personal loan features? 

While finding a personal loan with a killer interest rate should be one of your top priorities, another thing to compare are the features. These often help with making repayments more flexible and can sometimes assist you pay down your loan sooner. 

Some include: 

  • Free extra repayments 

  • Redraw facility 

  • Weekly, fortnightly and/or monthly repayment schedule options

  • Variety of loan terms   

But keep in mind, try to keep your fees low. Don’t end up coughing up too much for things like application fees, monthly fees, exit fees or early repayment fees. 

Are personal loan rates negotiable? 

It’s important to remember that when looking around for a personal loan, you may be able to negotiate with a lender on what they are initially offering. While they don’t promote the fact that rates are negotiable, it may be worth asking, especially if you’ve seen a more competitive product with another lender. 

Ultimately, lenders want your business. So they may be open to taking a small decrease in your interest repayments to ensure they don’t lose you as a customer. 

How can I reduce the amount of interest I pay on a personal loan? 

The aim when taking out a personal loan is to pay as little interest as possible. Other than locking in a competitive rate, there are also other tricks to keeping your interest repayments to a minimum. 

  • Make extra repayments where you can to reduce your principal and interest you pay. 

  • Choose a shorter term to reduce the length of time you pay interest. 

  • If you don’t need a loan straight away, make moves to improve your credit score so you can receive a lower rate on your loan.