Should You Use a Personal Loan or Credit Card for
Urgent Needs?
You're
stuck with an emergency expense. What should you use — a credit card or a
personal loan? The answer isn’t always simple.
1. When to Use a Personal Loan
- Amount needed is ₹50,000 or
more
- You need a fixed repayment
period (6–36 months)
- You want lower interest than
credit cards
- You’re okay waiting 24–48
hours for approval
2. When to Use a Credit Card
- You need instant money
- You can repay within 30–45
days
- The amount is small (under
₹20,000)
- You're getting a 0% EMI or
cashback deal
3. Interest Rate Comparison
- Credit Card: 30–45% per
annum
- Personal Loan: 10–18% per
annum
So, if
you can’t repay quickly, a personal loan is often cheaper in the long run.
4. Credit Score Impact
- Both affect your CIBIL
- Missed credit card payments
damage your score more
- Personal loans are more
structured — easier to manage
Conclusion
Credit
cards = fast but risky. Personal loans = slower but safer. Choose based on your
repayment ability, not just convenience.
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