What is a short-term loan in South Africa?
A short-term loan is a loan you repay within a year, in one payment or a few instalments. In law the label is narrower: short-term credit under the National Credit Act is a loan of up to R8,000 repayable within six months. Loans above that size or longer than six months are unsecured credit and follow a different interest cap.
The providers here cover both zones. PrimeLoans, LendPlus, Crediwise, Kredio and Creditbar offer terms from 5 to 61 days. Century stretches to 180 days. Creditomax, Finpug, Letocredit and Binixo list terms of 61 to 365 days, and Dengoo from 1 to 365 days. Those last five are matching services: they pass your request to partner lenders and do not lend themselves.
How does the term change what a short-term loan costs?
A longer term lowers each instalment but raises the total you pay, because the service fee runs every month and interest keeps accruing on what you still owe. The initiation fee does not change with the term, so it is the monthly fee and interest that grow.
Take R5,000 as an example, using the regulation caps as of November 2026 (fees before VAT, 15% VAT added). The initiation fee is R165 plus 10% of the R4,000 above R1,000, which is R565, or R649.75 with VAT. The service fee is R60 plus VAT, so R69 a month.
| Term | Service fees (R69 per month) | Initiation fee incl. VAT | Fees in total |
|---|---|---|---|
| 1 month | R69 | R649.75 | R718.75 |
| 3 months | R207 | R649.75 | R856.75 |
| 6 months | R414 | R649.75 | R1,063.75 |
| 12 months | R828 | R649.75 | R1,477.75 |
Interest comes on top. Beyond six months, or above R8,000, a loan counts as unsecured credit, and the interest ceiling is the repo rate plus 21% a year. With the repo rate at 7.25% since 25 September 2026, that is 28.25% a year. R5,000 repaid in equal monthly instalments over 12 months at that rate costs about R797.70 in interest (monthly rate 28.25% divided by 12, which is 2.354%). Over six months the same loan would cost about R419.97 if that yearly cap applied. The exact figure depends on your quote, and this is a ceiling, not an offer.
Is short-term credit different from an unsecured loan?
Yes, in the cap that applies. Short-term credit is limited to 5% interest per month on a first loan and 3% per month on later loans in the same calendar year. An unsecured credit transaction, the legal name for a normal personal loan, is limited to a yearly rate of the repo rate plus 21%.
For a one-month loan the short-term rule often produces a higher yearly equivalent, which is why small, quick loans look expensive on paper. For longer loans, the yearly cap usually works out cheaper per rand. The payday loans cost guide works through the one-month case in detail, and the prime rate page shows how rate moves feed into the caps.
What does a lender check before approving a short-term loan?
A registered lender must carry out an affordability assessment under the National Credit Act, which means looking at your income, your debts and your payment history before it lends. Expect to provide your ID number, a cellphone number and recent bank statements. The lender may also look at your credit record at a bureau.
A matching service works a step earlier. It collects your details and forwards them, so the credit decision and the check come from the partner lender, not from the service. Creditomax, Dengoo, Finpug, Letocredit and Binixo all say on their own sites that they are not lenders. Their advertised yearly rates differ widely: up to 36% at Finpug, Letocredit and Binixo, up to 58.4% at Dengoo and up to 180% at Creditomax, so read the offer's APR before you accept.
How do you pick a term and provider that fits your budget?
Choose the shortest term whose instalment you can pay without borrowing again, then compare the total cost in rand across providers for that same amount and term. Look at three things on each card: the term range, the amount range, and whether it is a lender or a service.
Before you sign, check the registration. Lenders show an NCRCP number, which you can match on the NCR register, as described in our registration guide. A matching service has no number of its own; ask for the lender's number in the offer instead. For the smallest, fastest loans, see the payday loans page, or open the lender directory for the full list. The interest ceilings come from Regulation 42.
46
