Many of us may need money in an emergency, which could arise multiple times. If we can’t turn to relatives or friends for help, we may consider taking a personal loan from a credit card company or a bank.
Most banks offer loans, and credit card companies provide similar services. Many people receive loan offers from both sources.
Banks directly offer personal loans, while credit card users often receive loan offers through phone calls or messages.
These loans can be used for various financial needs, such as going on vacation, hosting a function, or covering medical expenses during economic difficulties.
However, the key to choosing between a credit card loan and a personal loan lies in understanding the differences between them, and how they align with your financial circumstances and needs.
When it comes to the application process, if you already have a credit card loan from a bank, you may not need additional documentation.
However, for personal loans, you may need to provide some certificates to prove your income for the application process. Understanding these differences can help you prepare for the necessary steps when applying for a loan.
A credit card loan is best for a small loan amount, while a personal loan from a bank is more suitable for a larger amount.
The tenure for repaying a credit card loan is usually 12-36 months, whereas for a personal loan from a bank, it can be 12-60 months.
Credit card loans may include interest and processing fees. However, banks may sometimes waive these fees for pre-approved loans, and there may be other expenses, such as processing fees, for personal loans.
Regarding eligibility, a credit card loan is available only if you have a credit card. A good credit score is usually required for a personal loan, and having an account with the bank is also important.
Both types of loans provide money directly into your account, but credit card loans are usually approved within 24 hours, while personal loans may take 3 to 5 days for approval. Personal loans from banks generally cost more significant amounts than credit card loans.