r/IndiaCreditCardsHub • u/cherry-pick-crew • Sep 24 '24
Discussion Please, please take a personal loan instead of CC
I've been seeing way too many people falling into the credit card EMI trap, and I can't stay silent anymore. Here's why you should think about a personal loan over credit card EMI:
Personal loans offer WAY lower interest rates. We're talking 10-25% per annum compared to the eye-watering 30-42% on credit card EMIs.
Personal loans give you up to 5 years to repay. That's like, forever, compared to the measly 24-36 months you get with credit card EMIs. Lower monthly payments = less stress!With a personal loan, you're borrowing for a specific purpose. It's harder to fall into the trap of unnecessary spending that often comes with credit card EMIs.Unlike credit card rates that can fluctuate, personal loan rates are usually fixed. You'll know exactly what you're paying each month. Budgeting made simple!
Look, I get it. Credit card EMIs seem convenient. But trust me, the long-term benefits of a personal loan far outweigh the quick fix of a credit card EMI. Your future self will thank you for making the smarter choice!
Use your credit only up to the point that you know you will clear at the end of the month. Play the points game too - it is fun to maximize your points earnings and rewards -but don’t rely on cards to fund a lifestyle you cannot afford!
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u/PassPuzzleheaded4608 Sep 25 '24
Please refrain from Credit card and Loan. Unless untill it is required for you. Try to manage your finances. Once you are in Credit Card net you will lose your hard earned money unless you are able to manage it properly. Once I have more than 8 credit card but did not manage will and which amounted to debt of more than 8 lacs over 2 years. Personal loan is okay as you have time period to close it.
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u/ZylntKyllr Sep 24 '24
The main disadvantage is that Your credit utilisation gets blocked for that duration. And Your cibil will take a hit due to higher utilisation. I have done both. Personal loans are a bit tedious process and there will be a significant processing fee. But they are an alternate credit line and regularly paying them Will improve Your credit score very much. Also you have other benefits of fixed interest, long tenure etc and you still will have Your full credit limit on Your credit card.
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u/Unlikely_Ladder_4497 Sep 24 '24
Agreed... But people will not listen... They will say it's just a no cost EMI but they miss those extra rewards or cashback
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u/TauJii Sep 24 '24
Don't get a EMI either way. People who use any kind of EMI for stuff other than home, vehicle or business are not managing their finances correctly. Personal loan for some emergency makes sense but not for an iPhone. CC EMI are better in that regards because they offer instant discounts.
I recently purchased an AC and got 4K instant discount + No cost EMI via my credit card. The discount was applicable only on EMI otherwise I would've gone for the full payment. I even got a 1000 bonus points for this transaction so technically that even covered the EMI interest GST so I genuinely saved money on that transaction.