Indian banks offer loans for a variety of reasons – from purchasing vehicles and homes to shopping and hosting an event like a wedding; there’s so much you can do. One way that you can apply for a loan is through the usage of a Credit Card. Another way is to apply for a Bank of Baroda Personal Loan or any other Personal Loan.
Here, we will discuss about getting a loan on your Credit Card. All you need to do is to apply for a loan on the Credit Card and pay it back on or before the due date. Banks generally do not charge interest on a borrowed amount as long as it’s paid back on time. They can be used to pay for things today,and you can repay the amount later and are also accepted worldwide.
Banks generally offer loans on Credit Cards,and they’re called pre-qualified or pre-approved loans. If you’re looking to take a Personal Loan on Credit Card, here are a few Questions and Answers that can help:
- What’s the difference between withdrawals and loans?
Often, there is a bit of confusion when it comes to withdrawals and loans on Credit Cards. The general perception is that banks increase credit limits on these cards if you withdraw cash. However, it is a misconception,and banks can provide you with loans against a Credit Card.
These financial aids are a boon for people who require immediate money for any personal emergencies. You can apply for a loan on a Credit Card if the withdrawal limit does not suffice your needs.
- What is the eligibility for a loan on a Credit Card?
Generally, banks offer loans on Credit Cards without much documentation. The loan you receive is given in the form of a direct transfer to your bank account or via a demand draft.
The eligibilityfactors for a Personal Loan on a Credit Card include:
- It is important that you have a valid Credit Card account.
- Banks generally offer loans for both existing and new customers, but this can vary for certain banks.
- A good credit history is a must. Banks will only offer loans as long as you’ve been paying back your prior outstanding amounts.
- You can check for eligibility by using different methods including phone banking, net banking or visiting the nearest branch
- If you have a steady and high income, you can apply or even top up loans against your Credit Cards.
Which documents are required for a Credit Card loan?
Banks generally do not ask for much documentation when it comes to applying for a loan on a Credit Card. This is because to apply for the loan, you need a Credit Card,and banks already have the information with them. These documents include:
- Copy of address proofs such as telephone bills, recent electricity bills, passports, driving licence, and other (any one or two of these documents).
- Identity proofs including voter IDs, PAN Card, passport, driving licence (Any of these documents).
- Recent passport size photographs and ID card and salary slips for your last three months if you’re a salaried employee.
- Self-employed individuals will have to submit an attested copy of their last ITR along with a copy of the PAN card.
What are the interest rates?
Interest rates of different banks differ. It could start at 12% and go right up to even 20%. The rate of interests also varies based on the card type (Gold, platinum, etc.). The main catalyst for a Credit card loan is as mentioned before – the credit history. As long as you can maintain a decent score, you can get a better interest rate as well.
What are some of the features of having a Credit Card loan?
Here’s a condensed list of the advantages that come with a Credit Card loan:
- Attractive, reduced interest rates that are lesser than cash withdrawals on the same Credit Card.
- Instant cash, whenever you have the need.
- No or minimal documentation needed.
- A simple telephonic call or an online transaction is all that’s needed to apply.
- Fast processing and faster disbursal of the amount post-approval.
- This loan is a type of unsecured personal loan.
- A minimal fee is charged
- The loan can be repaid in monthly instalments and monthly EMIs are billed to the credit card every
- These loans are sanctioned for tenure of around 24 months in general.
- Interest rates vary based on the Credit Card type.
- Flexible loan tenures can be enjoyed.
We hope that the above-mentioned information will be of some help if you are planning to Apply for Credit Card loan.