Which is Better Personal Loan vs Credit Card EMI?

When managing urgent expenses, both personal loans and credit card EMIs offer structured repayment, but they differ significantly in several aspects. If you ask me, personal loan vs credit card EMI, which is better, I will say it depends on your requirements. I have shared their differences below to help you make your decision.

Credit Card EMI vs Personal Loan

• Credit card EMIs let you convert a high-value purchase or outstanding balance into monthly installments (typically 3 to 24 months). Personal loans, on the other hand, provide a lump-sum amount with fixed EMIs and tenures. 

• The interest rates on credit card EMI are generally higher than personal loans. It is often fixed at elevated percentages across the tenure.

• Additionally, personal loans support longer tenures, offering more flexibility in repaying larger sums comfortably.

• Personal loans also aid credit utilization ratios and boost credit scores when repaid regularly. However, credit card debt lingering over months can hinder credit health.

A personal loan could be the best option if you want to pay for a large purchase or consolidate debt. A credit card with EMI possibilities may be more advantageous for regular purchases and taking advantage of sales.

Hi, first of all, Surbhi has done a great job of explaining the difference between personal loan vs credit card EMI difference. Along with that, I also believe that personal loans are a better option between the two. However, the difference between both these is not just limited to that; let me provide you with a few more differences between the two of them. 

Credit Card EMI Vs Personal Loan: Which is Better?

I have added the other differences between these two below. 

I believe that both of these loans come with their own set of disadvantages as well. I have added a few of those in a table below. 

And that’s about it. I hope you find this helpful. 

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How to Calculate EMI for Personal Loan?

I was quite in a dilemma about which is better credit card EMI vs personal loan hence, I consulted with a banking friend to get an answer. She explained to me their differences first so that I could decide which would suit my purpose more. I learned that credit card EMI generally comes with higher interest rates and shorter repayment periods. On the other hand, personal loans offer lower interest rates and a longer repayment period.

Which Is Better Personal Loan vs Credit Card EMI and Why?

I found a personal loan EMI to be a better option than a credit card EMI, mainly because I needed a good sum of money and would not have been able to pay it in a short time. Personal loans are great for larger amounts and credit card EMI are best for small and short-time purchases. Apart from this major difference, here are more differences between these two:

So you can decide which of these two will be the best to suit your needs and opt for that option.

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