Personal Loan v/s Credit Card
Posted by Palak Bisht on July 12th, 2019
Personal Loan v/s Credit Card
We are living in a world where financial needs surround us. Personal Loan and Credit Cards are the most popular loans which people are using nowadays. With the invention of these loans, it became easy to solve our financial crises.
Meaning of Personal Loan
Personal Loan is a loan which we get from the banks so that we can fulfil our financial needs on a large scale. In this Loan, we don’t have to give any type of collateral as it is an unsecured loan. It is availed by the salaried and self-employed applicants to meet their financial needs. There are EMIs to repay the Loan.
To know more about Personal Loan Coimbatore click here.
Meaning of Credit Card
Credit Card is a facility which is provided by the bank that allows the applicants to borrow some amount of money to meet their expenditures. This facility is for those cardholders who do not favour using cash. The applicant has to pay back the amount within a grace period of the Credit Card which you know on the period when you got it.
Why is Personal Loan better than Credit cards?
- As both Personal Loan and Credit Cards are unsecured Loan, but both have some differences in their interest rates and tenure.
- Personal Loan Provides you fewer interest rates as compared to the Credit Card. The interest rate of Personal Loan Coimbatore is 10% to22% per annum, whereas Credit Card Provides you with the Interest rates of 24% to 36% per annum.
- Personal Loan provides you with a high tenure. You can pay back you amount minimum from 1 year to maximum five years, but in Credit Card facility you are given the period of 45 days to repay the Loan. Credit cards period may disturb your monthly budget.
- In the services of Personal Loan, banks will decide your loan amount which will be based on your CIBIL Score and in the Credit Card you will get the lesser amount which will be based on your monthly credit limit.
- The documentation process of the Personal Loan Coimbatore is quite longer than the Credit Card. But it is right for you to submit the documents as it became easy for the bank to tell you about the special offers which are provided by the bank to the applicants of Personal Loan.
- Personal Loans can be applied online and offline, but for the Credit Card we have to receive it from the bank, their services are available for the doorstep, but there is a fear of losing it.
- Personal Loan Coimbatore provides you with the full amount of the Loan whereas in Credit Card you can directly pay the merchant by swiping the card.
Merits of Personal Loan
- It instantly got approved depending on your CIBIL Score. You can also get Personal Loan with low CIBIL Score, for that you can take Joint Personal Loan.
- It has a fixed payment schedule, and it will not disturb your monthly budget.
- It can be availed easily as compared to the other banks.