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Credit Card Vs Personal Loan: Credit card or personal loan, which option is best for you?

When you suddenly need money, there are two options: a credit card or a personal loan. A credit card is beneficial for small amounts and short periods, while a personal loan is suitable for larger amounts.

If you suddenly need money, you have only two options. Credit card or personal loan. Sometimes even credit cards have a transaction limit of up to Rs 3 lakh. However, let’s understand in simple terms which option should be used in times of difficulty, which option will be financially beneficial.

Sometimes a credit card is used quickly, while at other times a personal loan is chosen. The interest rate on personal loans also varies from bank to bank. In such a situation, how do you decide where and when to use a credit card, and when to use a personal loan? If you have such a question or need arises, you can also use this trick.

You do not need to be a customer of the bank to use a credit card. If you are not a customer of the bank, you can take its credit card. However, to take a personal loan, you need to be a customer of the bank. Moreover, if the CIBIL score is not good, there are difficulties in getting a personal loan. If it is not paid on time, there is a risk of the CIBIL score getting damaged.

While taking a loan from a credit card, it is not necessary to be a customer of that bank. But if you are thinking of taking a personal loan, then it is mandatory to have an account with that bank. You can apply for a personal loan only after opening an account.

To repay a loan taken from a credit card, you can take a new loan again from the same credit card. That is, a credit card can be used for loans repeatedly. But once you have taken a personal loan, if you want to take a personal loan again, you have to apply for it anew. At that time, your credit score is checked.

If your credit score is good, you will get a loan easily. But if the score is low, it may be difficult to get a personal loan a second time. Credit cards offer many benefits, such as reward points, gift cards, vouchers, discounts, and cashback. But personal loans do not offer any such offers.

So, should you take a loan from a credit card or a personal loan?

Most experts believe that if you need a small amount for a short period of time, it is better to take a loan from a credit card. Because you can easily repay it during the grace period. But if you take a large amount from a credit card and cannot repay it during the grace period, you have to pay a large amount of interest on it. This increases the chances of getting stuck in a cycle of debt.

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Bhupendra Pratap
Bhupendra Pratap
Bhupendra Pratap, has 2 years of experience in writing Finance Content, Entertainment news, Cricket and more. He has done BA in English. He loves to Play Sports and read books in free time. In case of any complain or feedback, please contact me @jharkhandbreakingnews@gmail.com
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