Company or employee loans are a lifeline for many working professionals. Whether you’re covering a medical emergency, buying a new laptop, or funding education—employee loans offer quick support.
But making the wrong move can cost you more than money.
Here are the top 7 mistakes employees make when taking company loans and how to avoid them—powered by Vizzve Finance.
1️⃣ Not Understanding the Loan Type
Some employees confuse:
Interest-free loans (taxable if > ₹20,000)
Salary advances (deducted from the next salary)
Low-interest loans from partners like Vizzve Finance
🔍 Solution: Always ask for loan classification. Opt for low-interest, flexible loans from certified NBFCs like Vizzve if you want faster approval & better control.
2️⃣ Ignoring the Fine Print
Skipping the terms & conditions often leads to surprise deductions, penalties, or even job-linked EMIs.
📌 Solution: Read loan agreements carefully. Ask HR or use transparent fintech apps like Vizzve to know repayment terms in advance.
3️⃣ Borrowing Without a Repayment Plan
Many employees borrow more than they need, without a repayment strategy—leading to EMI stress or salary garnishment.
📌 Solution: Use Vizzve’s EMI calculator to set affordable repayment terms before applying.
4️⃣ Assuming It’s Always Interest-Free
Not all company loans are free. Even if zero-interest, large amounts can attract income tax as perquisites.
📌 Solution: Know the tax implication. If you need over ₹20,000, a low-interest loan from Vizzve may actually cost you less post-tax.
5️⃣ Not Comparing with Market Options
Company loans are not always the cheapest or fastest. Many forget to compare with personal loans or digital lending apps.
📌 Solution: Compare with Vizzve Finance’s instant salary-based loans for competitive rates and faster disbursal.
6️⃣ Overlooking Credit Score Impact
Some company loans aren’t reported to credit bureaus. That means your timely repayments won’t improve your CIBIL score.
📌 Solution: Use regulated NBFCs like Vizzve that report to credit bureaus and help build your financial profile.
7️⃣ Blindly Accepting HR’s Offer
Employees often take whatever loan HR offers—without asking for alternatives, negotiating tenure, or checking other NBFCs.
📌 Solution: Ask questions. Or choose Vizzve, where you control your amount, tenure, and repayment method—with no HR dependency.
Bonus Tip: Always Have a Backup
Emergency? Festival? Education? Before borrowing, ask:
Do I really need this loan?
Can I repay without missing EMIs?
Am I getting the best deal with full transparency?
With Vizzve Finance, you get:
Loan amounts from ₹5,000 to ₹5,00,000
Instant approval (within 30 minutes)
No HR involvement
Low-interest EMIs starting at ₹375/month
FAQs – Common Employee Loan Mistakes
1. Are company loans always better than personal loans?
Not always. Company loans may have limitations. Vizzve offers competitive low-interest salary loans without employer dependency.
2. Can I prepay a company loan anytime?
Depends on your HR policy. With Vizzve, prepayment is always free.
3. Will my company loan affect my credit score?
Only if reported to credit bureaus. Vizzve loans do impact your CIBIL positively when repaid on time.
4. Is there a processing fee for employee loans?
Yes, sometimes hidden. Vizzve has zero hidden fees and flat processing charges.
Published on : 25th July
Published by : SMITA
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RBI-Registered Loan Partner | 10 Lakh+ Customers | ₹600 Cr+ Disbursed