When you need quick cash, you might consider either a personal loan or a credit card cash advance. Both have pros and cons depending on your financial situation and repayment ability.
Vizzve Finance explains how to choose wisely between these two borrowing options.
What is a Personal Loan?
A personal loan is a fixed amount borrowed from a lender with a set repayment schedule and interest rate, typically lower than credit card cash advances.
What is a Credit Card Cash Advance?
It allows you to withdraw cash using your credit card but usually comes with higher interest rates and fees, starting from the day you withdraw.
Key Differences to Consider
| Feature | Personal Loan | Credit Card Cash Advance |
|---|---|---|
| Interest Rate | Lower, fixed or variable | Higher, often immediate accrual |
| Loan Amount | Larger amounts possible | Usually limited to cash limit |
| Repayment Term | Fixed tenure (months to years) | Revolving credit, minimum monthly |
| Fees | Processing fees, prepayment fees | Cash advance fees, high interest |
| Application Process | Requires documentation | Instant access via credit card |
When to Choose a Personal Loan
Need a larger sum of money.
Want predictable monthly payments.
Looking for lower interest rates.
Planning to repay over a longer period.
When to Opt for a Credit Card Cash Advance
Need immediate cash for a small amount.
Comfortable with higher interest for short-term use.
Already have a credit card with cash advance facility.
How Vizzve Finance Helps You Decide
Vizzve Finance offers personalized loan options and expert advice to help you select the right financing based on your needs and repayment capacity.
FAQs
Q1. Can I convert a credit card cash advance into EMI?
Some cards allow EMI conversion; check with your provider.
Q2. Are there penalties for prepaying a personal loan?
Depends on the lender; some charge prepayment fees.
Q3. Is it better to avoid cash advances due to high interest?
Generally yes, unless it’s a small, urgent need.
Q4. Does Vizzve Finance provide both personal loans and credit card services?
We primarily offer personal loan products with flexible terms.
Published on : 10th August
Published by : SMITA
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