Loan on Credit Card
Loan on Credit Card is just like personal loans, but these are pre-approved and it comes without any need and any documentation. Although a personal loan is among the fastest options for getting a loan, some little paper work is still required and hence it may take a some days at least for it to comes through.
In case of a Loan on Credit Card, there is no need of any paper work and hence it is the fastest source of unsecured fund finance.
Loan on Credit Card is normally mistaken for cash withdrawals on credit cards. The main difference is the rate of interest applied – interest rate on loan on credit card will be little closer to or a few notches high than that of a personal loan while rate of interest on money withdrawals tend to be much high and also the limit on cash withdrawals could be much less than that of the eligible credit loan amount on the credit cards.
This loan facility may be good suited when there is an urgent need of cash and you cash withdrawals limit is insufficient to fulfil your needs. Cash withdrawals on credit cards can satisfy your needs at the spur of the moment but it comes with a high rate of interest.
So, it makes more good economic sense to choose for loan on credit card than the cash withdrawal facility. Why because the rate of interest is lower and the loan disbursal is also fast because of no paper work needed. A loan borrower / you will either receive a dd (demand draft) from the bank or a directly transferred to your bank accounts.
Credit Card Loan Features
- Loan on credit card is like a personal loan with the added advantage that there is no paper work involved as it is pre approved loan. So loan approval is fast.
- Loan processing fees will be charged which normally be a minimum of a particular sum or a some percentage of the given loan amount.
- The loan repayment will be in monthly instalments and there may be a prepayment facility also with a charge on prepayment. The EMI‘s (equal monthly instalments) will be billed to your credit card each month.
- This loan can be for a maximum time period of twenty four months with slabs of six, twelve, eighteen and twenty four months.
- The interest rate will depends on the type of credit card means platinum, gold and silver along with the credit profile of the customer. So manage good credit score and credit history, which is key as the interest rate quoted will take into consideration those key factors.