The first thing that comes to your mind when you're faced with financial difficulties is a personal loan as it offers funding without collateral. But you can also opt for a loan against credit card, where a portion of your card limit is offered as a loan. Here are some differences between both the loans which will help you to make sound decisions while opting for a loan.

Ease of documentation

While you have to furnish the required documents from scratch while applying for a personal loan; you need not do the same with credit card loans as they are pre-approved loans. This accelerates the application process.

Securities and eligibility

Both the loans are unsecured. But as opposed to personal loans; a loan against credit card is tougher to obtain as you have to prove your capabilities with a good CIBIL score and stable income.

Interest rate

Personal loans have a higher interest rate than credit card loans.

Loan amount and end use

You can get personal loans up to Rs.25 lakh. But the sanctioned amount on personal loan on credit card primarily depends on your credit card limit. In terms of end use; you can use both the loans in any manner.

Go through all the differences between a personal loan and personal loan on credit card before finalizing one. Also, make sure to select only reputed lenders.

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