You have several options for borrowing money, and each has special qualities, advantages, and disadvantages. Personal loans and line of credit are two common options. Both don't require collateral because they are typically unsecured. So, you must know which is better line of credit or personal loan. I have shared the difference between them below.
Which is Better Personal Loan or Line of Credit?
Choosing the better option depends on your financial habits and needs. Here are the differences between them below.
Personal Loan | Line of Credit |
It is a fixed-sum loan disbursed upfront with a fixed tenure and interest rate. You repay it through equated monthly installments (EMIs). | It is a revolving credit facility. You are approved for a credit limit, and you can borrow as much or as little as needed, multiple times. |
It is ideal for one-time expenses such as weddings, medical emergencies, or large purchases. | Interest is charged only on the amount utilised, not on the total limit. You can use it for business needs. |
Personal loans are easy to plan and budget for, but you pay interest on the entire amount, regardless of how much you use. | Lines of credit are less common for individuals. But FinTech platforms and banks increasingly offered them through overdraft or credit line products. |
If you need a lump sum for a specific purpose, a personal loan is better. I hope you understand the line of credit or personal loan which one is better.
Get Loan Up to 10 Lakhs Instantly to Your Account with NB InstaCash
Also read
How can I Get an Instant Loan in 5 Minutes?
Your Feedback Matters! How was this Answer?
Shifting, House?
✔
Lowest Price Quote✔
Safe Relocation✔
Professional Labour✔
Timely Pickup & Delivery
Intercity Shifting-Upto 25% Off
Check Prices
Intracity Shifting-Upto 25% Off
Check Prices
City Tempo-Upto 50% Off
Book Now
Which is Better Line of Credit or Personal Loan?
Ashwin76
52 Views
1
8 months
2025-04-18T10:24:01+00:00 2025-04-18T10:24:02+00:00Comment
Share