No-Interest Loans Scheme (NILS): How Australians Are Accessing Interest-Free Finance in 2025
With the cost of living still rising and credit tightening in 2025, many Australians are seeking safer ways to borrow. Enter the No-Interest Loans Scheme (NILS)—a government-backed initiative helping thousands access interest-free loans for life’s essentials. As new policy updates expand eligibility, NILS is playing a crucial role in keeping vulnerable Australians out of debt spirals, while supporting community wellbeing.
NILS is a not-for-profit microfinance program offering interest-free loans of up to $2,000 (sometimes more for specific needs, such as vehicles or housing essentials). Designed for people on low incomes, NILS helps Australians pay for whitegoods, medical expenses, car repairs, education, and more—without the risk of interest or hidden fees. The scheme is operated by Good Shepherd Australia New Zealand in partnership with the Australian government and 170+ local community organisations.
Recent policy updates in 2025 have widened the income thresholds and streamlined the application process, making NILS more accessible to working Australians facing financial stress—particularly in regions hit by rising rents or disaster recovery.
In 2025, the demand for NILS continues to soar. According to Good Shepherd, applications have jumped by over 30% compared to pre-pandemic levels, with many households struggling to cover unexpected expenses.
Case in point: After losing her fridge to a power surge during the 2024 Sydney storms, Maria from Bankstown used NILS to replace it within a week—without resorting to payday lenders or buy-now-pay-later traps. “I was able to repay $30 a fortnight, and I didn’t have to worry about extra costs,” she says. Similar stories are emerging in regional Queensland, where NILS is being used for car repairs, helping essential workers stay employed when public transport is limited.
The scheme’s reach has also expanded to support:
Notably, the 2025 Federal Budget allocated an extra $30 million to NILS, ensuring more Australians can access these critical loans as cost pressures continue.
With inflation keeping household budgets under pressure and traditional lenders tightening criteria, NILS offers a vital safety net. Where payday lenders and buy-now-pay-later services can trap borrowers in cycles of debt, NILS provides a sustainable pathway to financial stability.
Key benefits in 2025:
For many, NILS is more than a loan—it’s a lifeline. Whether it’s keeping the lights on, getting kids to school, or replacing essentials after a disaster, the scheme is proof that financial inclusion policies can transform lives and communities.
The application process is now faster and more accessible than ever. Applicants can begin online or through local community organisations, with most approvals taking just a few days. Required documents include proof of income, identification, and basic bank statements to demonstrate capacity to repay. There’s also extra support available for those facing language barriers or digital exclusion.
2025’s streamlined system means you’re more likely to get a decision quickly, and dedicated NILS officers can connect you to broader support if you’re experiencing hardship beyond the immediate loan need.