Payday Loans vs. SACC / MACC Loans: Which are Better?
You’re thinking about taking out a personal loan – after all, you’ve got holiday gifts to buy and completely forgot about the upcoming servicing on your car!
What kind of instant loan would suit you best? To learn the difference between payday loans and SACC/MACC loans (as well as which we’d recommend!), keep reading.
‘Payday Loans’ are exactly what you might expect; they’re loans to see you through to your next payday. These cash loans aren’t offered through banks, but rather private businesses or loan stores. The concept of a payday loan may seem great at first, but because the loan is only for a couple of weeks and comes with a high-interest rate, it’s easy to wind up indebted to the loan company. Think about it; you borrow money to cover your expenses until payday rolls around, use the majority of the pay cheque to repay the loan store, and then realise your remaining $50 won’t get you through until the next pay cheque. The solution? Borrowing money, yet again.
Unlike payday loans, SACC (Small Amount Credit Contract) loans are regulated through the government under the 2009 National Consumer Credit Protection Act and can be drawn up to span a time frame anywhere between 16 days to 1 year. These small loans cover you up to $2,000 and are perfect for when you’re between payments and simply need an extra boost to see you through.
MACC (Medium Amount Credit Contract) loans are also regulated by the government, under the same Protection Act as SACC loans. These loans cover amounts ranging from $2,001 to $5,000, and span anywhere from 16 days to two years, making them a better option for bigger expenses, such as purchasing a new refrigerator or covering unexpected dental work.
MACC loans are larger than SACC loans and you may be required to “secure” your loan by offering an asset as security against the loan, however because these loans give you adequate time to make payments, you shouldn’t run into the debt issue posed by payday loans.
Considering a SACC or MACC loan? At Speedy Finance, we offer both options and will guide you through the payment process. There’s no need to get stuck in the payday loan cycle ever again!