By JOHN VAN KLAVEREN
When Neil Nedic’s car died a few years ago, like many, he did not know where to turn to pay for the repairs.
“I went to one of the payday lenders,” the Geelong West pensioner said.
“They’re nice when they’re trying to get you to lend money but it’s not so nice when they want you to pay it back and charge a higher rate,” Mr Nedic said.
But when his car needed repairs again recently, Mr Nedic sourced a different solution.
“I heard about Geelong No Interest Loan Scheme (NILS) from a local charity organisation,” he said.
“They’re much more affordable and they help you along the way. They don’t lend you money you can’t afford.
“I’m on the good cycle now instead of the bad cycle I was on back then.”
Geelong NILS chairman Sean O’Shea said Mr Nedic’s story was a common tale among many Geelong residents on tight budgets.
“We still find that more people go to the payday lenders instead of coming to us,” Mr O’Shea said.
“We need to get the word out that payday lenders are not the only or the best, solution when people are faced with a financial emergency.”
Mr O’Shea’s made his call for awareness as Australian Securities and Investment Commission (ASIC) came down hard on a payday lender.
The national corporate watchdog ordered Rescue Credit to repay more than $35,000 to consumers.
The company had applied fees and charges “in the range of 56 to 68 per cent, in excess of the permitted annual cost rate of 48 per cent”, ASIC said.
Since 2010 ASIC enforcement action has resulted in close to $2 million in refunds for more than 10,000 consumers overcharged when taking out a payday loan.
But Geelong residents could have faith in borrowing from NILS, Mr O’Shea said.
“We offer fair and affordable no interest loans of up to $1200 to people on low incomes for essential goods and services.
“Often people on fixed or low incomes are faced with an emergency and do not have anything to draw upon.
“The most common reasons people need a loan is for medical and dental services, education essentials such as computers and text books or household items like fridges, washing machines and furniture.”
Mr O’Shea said the organisation worked through local community centres and received referrals from human services organisations.
A national organisation, NILS operates under the auspices of St Vincent De Paul Society and is connected to Good Shepherd microfinance, which has a storefront in Moorabool Street, Geelong.
“We started in 2009 and we deal direct with the suppliers of goods and services instead of the loan going to the person,” Mr O’Shea said.
“We also have a savings program through NAB. If participants save $500 then NAB matches it.
“We’re not financial counsellors but we can help with tips and advice on improving financial management.”
