Answer
What Is a Comparison Rate?
Australian lenders must publish a comparison rate alongside the interest rate. It folds in fees — but it is calculated on a standard example, not on your loan.
Updated 25 August 2026 · 3 min read
Money basics (Australian)
The vocabulary: APR, APY, AER, interest, inflation and the rest.
Australia does not use APR as its main disclosure. Lenders quote an interest rate alongside a comparison rate, which folds in most fees — but is calculated on a standardised example loan rather than on the amount you are borrowing. Knowing the difference between the two figures is what stops a low headline rate from misleading you.
What this section covers
- What each advertised percentage actually includes
- Where a headline rate misleads
- How compounding changes a return
- Working out the cost of a specific deal
Written for Australia. Terminology, protection limits and regulators differ between markets, so a guide from another country will not transfer cleanly.
Australian money basics guides
Answer
What Is APR, and Does It Apply in Australia?
APR is a US and UK term. Australian lenders quote an interest rate and a comparison rate instead — here is how they line up.
Updated 25 August 2026 · 2 min read
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