Nothing in life is certain. A person with sound financials can also come at a point in life when urgent need of money arises. This could be due to various reasons such as medical emergency, marriage etc. In such scenarios when all the options for arranging money fail, the only option left is the personal loan.

And for individuals having credit card with good credit score getting a personal loan is not a problem. Since they have made use of credit card carefully within the available limit and has a good repayment history are eligible for personal loan against credit card. These lucky individuals get pre-approved loan offers or they can also check their eligibility by directly contacting their banks. However not all are eligible for such offers even after having an excellent transaction history. Decision is totally dependent on the banks and only customers with specific credit cards such as (gold/platinum/silver and others) are only offered this facility. Read on personal loan for low income earners.

Advantages:

There are many advantages of personal loan against credit cards such as:

• Higher loan amount than the credit limit
• However there are some banks who offer loan within the credit limit
• Interest rates are attractive
• Various tenure options are available ranging from 1 year to 5 year with almost every bank.
• Funds are directly transferred to the bank account of the customer and takes normally 3-4 days
• If an individual does not have account in the applied bank, then funds transfer is done either through demand draft or NEFT. In case of demand draft, 10-12 days are required for the funds to get transferred.
• No documentation required for verification
• No requirement of guarantor
• Banks also offer online facility to their customers to check whether they are eligible to get personal loan against their credit card.

Here are few banks offering personal loan on credit card:

• HDFC Bank
• ICICI Bank
• Citibank
• Axis Bank
• Standard Chartered
• Kotak Mahindra Bank

With benefits comes various charges which mainly includes processing and pre-payment penalty. But before taking this facility applicant should be aware of or check following points with the bank:

1. Terms and conditions of the respective bank.
2. Whether there is any clause of making advance payment of EMI.
3. Whether the cash limit or credit limit is released upon complete repayment of the loan amount including interest, service tax etc.
4. Is there any option to cancel the loan and how will the amount credited into the account of the customer gets reversed.
5. What are the late payment charges
6. If auto-debit is selected, date when money is debited from the bank account. And in case, bank balance is low and auto-debit fails, what are the options to repay and applicable charges
7. Any offers where no processing fee is charged and what are the conditions.
8. Whether partial pre-payment or partial closure is allowed and the associated charges
9. Can EMI repayment option be changed? For e.g. if someone change auto-debit option to cheque/cash and vice-versa and are there any charges.
10. Can multiple personal loan be taken against one credit card
11. Can tenure be changed after the loan account has started

Do you know that concept of peer to peer lending (PTPL) is growing in India. PTPLs offer personal loan at low interest rate and approval time is short. Read details on PTPL.