In the past two years, the amount of loans provided by NILS Tasmania has increased 44 per cent, while demand for laptop and computer purchases during COVID school lockdowns spiked by 150 per cent.

The appliance scheme allows for heat pumps to be purchased at half the price, while fridges, freezers and washing machines have $300 off without interest.

NILS Tasmania chief executive officer John Hooper said there were many examples of disadvantaged Tasmanians being able to buy appliances that were previously out-of-reach.

"Another quote that came through a loan recently was, my husband has a brain tumour, he now can't get wood in for the fire, we could never afford a heat pump on our own, so you've just made this winter a little easier for us," he said.

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"[There's a] grandmother down in Rosebery that was under three doonas, but hadn't heard about us, and hadn't heard about the energy subsidy. She was in tears and she couldn't even believe it."

The state government has increased funding to NILS from $1 million to $2 million over four years.

The organisation encouraged more Tasmanians to access the scheme, confident it could handle further increases in demand.

Mr Hooper said the program would prevent Tasmanians from accessing rent-to-buy schemes and payday lenders, which can have exorbitant interest and late fees.

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"The alternative to a NILS loan is people will go to a rent-to-buy scheme, or a payday lender to fund that, so an $800 washing machine will cost you $2400 through a rent-to-buy scheme," he said.

"Through a NILS loan, we know we have been saving people basically for every $1 of subsidy the government has provided to us, we've saved families $5 in interest and charges if they'd gone to a rent-to-buy scheme.

"Unfortunately, prior to COVID, Tasmania had the highest proportional growth in payday lending in Australia."

Numerous reports from the Senate and research bodies have urged the federal government to provide greater protections for consumers in the payday lending industry, but these have not been acted upon.

Energy Minister Guy Barnett said the funding increase could allow NILS to increase its client base by an estimated 4000 people over 12 months.