Not being able to repay the credit card loan on time results in a huge burden of paying the outstanding loan amount and high interest rates, and this situation is increasing in today’s India.
To pay off all the loans and interest in full, people often resort to personal loans to gain control over their finances and live a controlled lifestyle without any sacrifice.
Personal Loan For Credit Card Debt: What Are They?
A personal loan for credit card debt is an unsecured type of loan for any personal purpose, such as paying off credit card debt, tuition fees, household expenses, etc.
Unlike the interest rate of credit card debt, which ranges from 30% to 45% p.a., the personal loan interest rate is much lower than that of credit card debt, with better structured repayment terms.
It aims to repay all the high-interest credit card debts into a single personal loan amount with a low interest rate and a flexible long repayment period to help in debt management.
Factors to Choose a Personal Loan for Credit Card Debt:
| Factors | Credit Card Debt | Personal Loan |
| Interest rate | 30% to 45% per annum | 10% to 18% per annum |
| Duration | No Specific End Date, But Penalty Applied | 1 to 5 Years |
| Repayment Method | Depending on Credit Use | Fixed Monthly EMIs |
| Best Use | Short Term Borrowing | Debt Consolidation |
| Impact on Credit Score | Negative if the dues are unpaid | Positive if timely repaid |
Key Points of Taking a Personal Loan
- Interest Rate: Offering lower interest rates than a Credit Card makes it more reliable and trustworthy among borrowers.
- Fixed Payment: In a personal loan, there is a fixed amount paid monthly, in knowing how much needs to be paid for the loan, unlike a credit card loan, which is known as a revolving loan.
- No Collateral Required: A Personal loan is an unsecured loan, so there is no need to bring any valuable assets for collateral as security for the loan to the lender.
- Consolidate Debts: By repaying the card debt with a personal loan, you can manage multiple credit card debts more effectively.
- Increase Credit Score: Paying off all credit card debt will eventually increase the credit score, and making monthly payments on personal loans also positively affect the credit score.
Related Blog : Credit Card Loan Vs Personal Loan – Best Choice?
Eligibility Criteria
✅ Age: 21 Years to 60 Years
✅ Monthly Income: ₹15,000 and Above
✅ Employment: Salaried Person and Self-Employed
✅ Credit Score: Prefer 650 or above
✅ Job Stability: Minimum 6-12 Months in Current Job and Profession or Business
Documents Required
- Identity Proof:
- Driving License / Voter ID / Aadhaar Card / Passport / PAN Card
- Address Proof:
- Aadhaar Card / Passport / Utility bills / Rent agreement (if applicable)
- Income Proof:
- Salaried Person: Last 3 months’ salary slips / Last 6 months’ bank statement / Form 16 (optional but recommended)
- Self Employed: Last 6 months’ bank statement / Income Tax Returns (ITR) for the last 2 years / Business registration certificate or GST details
- Employment Proof:
- Salaried Person: Employee ID card / Offer letter, or experience letter from the current employer
- Self-employed: GST Certificate & Certificate of Business Registration
Platforms Offer Personal Loans for Credit Card Debt:
| Platforms | Interest Rate (P.A.) | Loan Amount | Tenure |
| Finnable | 15% to 26% | 50,000 to 10,00,000 | 6 Month to 5 Years |
| IndiaLends | Varies | 50,000 to 25,00,000 | 1 Year to 5 Years |
| IndusInd Bank | 10.25% to 22% | 50,000 to 25,00,000 | 1 Year to 5 Years |
| Fullerton India | 12% to 24% | 50,000 to 25,00,000 | 1 Year to 5 Years |
| Nira Finance | 14% to 26% | 5,000 to 1,00,000 | 3 Months to 1 Year |
| CASHe | 18% to 30% | 1,000 to 4,00,000 | 3 Month to 1.5 Year |
| EarlySalary | 18% to 30% | 5,000 to 5,00,000 | 3 Months to 2 Years |
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Conclusion
Personal loan for credit card debt are a quick and easy solution for lowering interest, simplifying payments, and clearing debt fast. Take control of your finances now by applying!
FAQs
Does someone need collateral or a guarantor to get a personal loan?
No, usually the funds provided by the lenders in a personal loan are unsecured, therefore, there is no requirement to arrange any assets as collateral or someone as a guarantor.
