Pensioner loans

Just because you receive superannuation does not mean you can’t take out a loan.

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small personal loans

If you receive Work and Income payments, including superannuation, and are looking for a loan, it can limit your options. Lenders may have stricter criteria for those receiving supported living or superannuation payments.

It’s essential to know there are loan and finance options out there. It’s even more important to understand how to compare these options, so you find the right product for you. Read on, to see what’s available, compare your options and find out how to apply.

Retired? Click here to see your loan options

Financial hardship

For information on managing debt and further advice, call the New Zealand Federation of Family Budgeting Services on 0508 283 438 (freephone).

What loan options do pensioners have?

The right loan depends on your financial situation and the type of pension you receive. Here are a few options that people on superannuation can consider:

  • Your existing bank. If you’ve held an account with your bank or credit union and have a good history with them, this may be an excellent place to start. You can visit in-branch to discuss your options and find out what loans are available.
  • Low-doc loans. Providers design these loans for self-employed applicants or borrowers whose income is tied up in investments. If this describes your situation, it might be an option to consider. Bear in mind, these loans usually come with higher interest rates and typically only let you borrow up to 80% of a property’s price.
  • Short-term loans. As these loans are smaller and repaid over a shorter term, they have more flexible lending criteria than those set by banks and other lenders. You can usually borrow between $100 and $2,000 for a period of 2 days to one year. Many lenders understand that superannuation payments vary from one person to the next. The loan provider will verify your income and expenses before they potentially fund the loan.
  • Bank loans. Some banks, such as those listed in the table above, consider applicants who are receiving superannuation. You usually need to meet minimum income criteria for approval.
  • Loans for retirees. If you receive superannuation, are a self-funded retiree or a pensioner, there are loans specifically designed for you and lenders that will consider you. Follow the link below to find out more about retired loans.

Loans options for retirees

Government assistance schemes

The Government has established a few programs and support options for people who are receiving superannuation.

  • Government financial help if you are over 65
    The government can assist with regular and unexpected expenses, ie if you receive superannuation or a veteran’s pension. These include the following: housing, health and travel; essentials, like home repairs, glasses or a cooker; or an emergency you are unable to pay, eg dental costs.
  • No interest loans scheme (NILS)
    This scheme offers loans of up to $1,000 to people on low incomes to buy essential household items, health items or to pay for car repairs in some cases. To be eligible, you must have a community services card or be on a low income and be able and willing to repay the loan within approximately 12 months.
  • Work and Income cash advance
    If you regularly receive superannuation payments, you may be eligible to receive these in advance. Whether you qualify depends on how much you and your partner earn and whether you have any other form of income or assets.

Sharon and Greg


As a couple, Sharon and Greg receive $1,154.80 through supported living payments, after Greg had an accident at work, and it is their only source of income. They rent an apartment and their budget is stretched tight, not leaving any room to purchase significant items. Their fridge breaks down, and they need $1000 for a new one.

Sharon and Greg are not eligible for a personal loan from most of the larger banks because their income is not sufficient. They consider their payday loan options, which will allow them to borrow the money and make repayments to coincide with their Work and Income payments. However, they find out that they have to pay back the loan within 60 days and this is not manageable on their budget.

What they decide to do: Sharon and Greg then take a look at a StepUP loan from The Salvation Army and realise they can borrow $1000, because they are using it to finance an essential household item. They can choose to pay the loan back over two or three years and their payments may be as low as $21 a fortnight. They decide this level of repayment is manageable on to their budget. The loan also comes with a low fixed rate of 6.99% p.a. and is more affordable than some of the other loans they were considering.

All rates, fees and repayments correct at the time of writing.

How can pensioners apply for loans?

The table above gives you a good starting point to find a pensioner loan. Click “More Info” to read a full review of each provider and “Go to Site” to submit your application. If you have questions regarding your eligibility, it is best to contact the provider directly.

Loan providers list every application you make on your credit file and too many requests within a short space of time is not a good look to a prospective lender. If you would like to see if your bank will approve a loan, have a chat with them over the phone, online or in a branch to see what they say before you apply.

To apply, you need to provide the following:

  • Personal information: including your name and contact details.
  • Financial information: regarding your superannuation payments, assets, debt and open credit accounts.

Picture: Shutterstock

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