Ann: Response to Anonymous Report, page-70

https://www.speckle.com.au/

This is the lender offering discounted SACC loans mentioned in the response from CCP.

Speckle is operated by Good Shepard Micro-finance and funding is provided by NAB as a community service.

The fees are 10% upfront establishment fee, after which 2% of the loan amount is charged per month.

For instance, a $1000 SACC from Speckle costs $340 overall (34% effective APR), whereas it would cost $480 from WW on a one year term (48% effective APR).

So, CCP's claim that it is cheaper than the discounted product, if the product is from Speckle, is sadly only a half truth. The WW APR of 48% is 14% more than Speckle's 34% APR. However, because Speckle has a 10% establishment fee and WW does not, WW is in fact cheaper than Speckle for loans taken out for periods shorter than 5 months. There is a calculator you can play around with on the Speckle website and once is hits 5 months Speckle is cheaper in absolute terms.

Although, there is of course a catch. Speckle appears to have high lending standards, so much so it is ironic that this is supposed to be a not for profit initiative helping those in need. Speckle has a MINIMUM income requirement of $30K gross per year, EXCLUDING any governments benefits, eg Family Tax Benefits and/or Centrelink. If government benefits are part of an applicant's income, that can only make up LESS THAN 50% of gross income. Additionally, there is a caveat that if you have had 2 or more payday loans in the past 90 days you're automatically excluded.

So basically, the ethical product offered by NAB is much cheaper than WW, on loans 5 months or beyond, however Speckle excludes, by default, a large chunk of the market because it has high lending standards. I would speculate that a lot of applicants that could get a Speckle loan, could also get a small limit credit card or more conventional personal loan. It also doesn't appear to offer the ease of borrowing at which the for profit operators provide, not surprisingly.