Credit Cards are undoubtedly amongst the most popular financial products coming from financial institutions in India. Apart from making cash-less and digital transactions to gaining reward points for various lifestyle expenses, Credit Cards offer a lot of benefits if used in the right way. One such benefit that Credit Cards bestow upon the holder is the availability of easy credit.
Easy Loans with Credit Cards are pre-approved Personal Loans offered by the issuing company to eligible customers. It is pertinent to mention that easy loan with Credit Cards is an add-on facility extended by the bank to select customers; it is not available to all the customers. Based on your repayment history and credit profile, banks offer a pre-approved Credit Card Loan with flexible repayment tenor at attractive interest rates against your card.
The EMIs for the Credit Card Loan will be mentioned in the Credit Card statement and will be over and above the dues payable against the Credit Card in a month. This loan is similar to a Personal Loan availed from any other financial institution; however, this is a pre-approved offering, i.e., you need not go through the hassles of application and documentation. Moreover, as these loans are pre-approved, they are processed immediately, and the amount is transferred to your bank account within a few hours.
Features of a Credit Card Loan
Here are some of the noteworthy features of a Credit Card loan that you must be aware of:
● As most of the Credit Card Loans are pre-approved, you are not required to submit any extra documentation to the bank, and the loan will be processed and disbursed quickly.
● You can also convert your expensive purchases into easy EMIs, because of the EMI schemes offered by many Credit Card issuers.
● Some banks also offer Credit Card Loan against other bank’s Credit Card through Balance Transfer on EMI, providing you with the offer to transfer the outstanding balance on other Credit Cards to anyone particular Credit Card and pay the EMI.
● The Credit Card loans offered by issuers can be within or over the Credit Card limit, depending on the credit profile of the customer.
Eligibility criteria for Credit Card Loans:
Usually, the Credit Card Loans offered by card issuers are unsecured and do not require any collateral. Credit Card loans are offered to select credit cardholders only. The most important deciding factors in determining whether or not to offer the facility of a Credit Card loan to a customer are a good credit score, usage pattern of the card and repayments made against the monthly dues.
Quantum of a Credit Card loan
The quantum of Credit Card loans usually depends on the credit limit of the card issued to the customer. Many banks offer Credit Card loans above the credit limit, and the availed loan amount will not be blocked against the credit limit. Also, many banks provide an option where you will be able to convert any transactions above Rs. 2,000 or Rs. 3,000 (depends on the bank) into an instant loan and repay the amount through easy EMIs that will be charged in the monthly statement of your Credit Card. This facility can be useful for any expensive purchases made using the Credit Card.
Top Banks offering Credit Card Loans in India
With multiple options available in the market, it is important for you to identify the best Credit Card Loans. Following are some of the top banks offering Credit Card loans in India:
1. SBI Credit Card Loan
State Bank of India offers Encash, a pre-approved SBI Credit Card Loan for amounts starting from Rs 10,000. The maximum loan amount depends upon the credit limit of the card. Encash offers flexible repayment tenor between 12 to 36 months. The interest rate for SBI Credit Card Loan is disclosed upon application only. However, the processing fee for SBI Credit Card loan can go up to 2% of the loan amount (Rs. 499 being the minimum and Rs. 3,000 being the maximum) plus applicable taxes.
2. HDFC Credit Card Loan
HDFC Bank offers two types of HDFC Credit Card Loans, namely, Insta Loan and Insta Jumbo Loan depending upon the customers' requirements. The maximum loan amount offered depends upon the credit limit of the card. The interest rate for an HDFC Credit Card Loan is calculated using the reducing balance method and will be disclosed only at the time of loan application. The borrower can choose a repayment tenor suitable for him/her to repay the HDFC Credit Card Loan and the EMI of the Credit Card loan will be mentioned in the bill and will be a part of the minimum amount due for a given month.
3. Kotak Mahindra Bank
Kotak Mahindra Bank offers Credit Card loans up to a maximum amount of Rs 5 Lakh at attractive interest rates. The bank offers flexible repayment tenor ranging between 6 to 48 months. As it is a pre-approved loan, it does not require any documentation and the loan amount is instantly transferred to the customer’s Kotak or any other bank’s savings account. The processing fee for Kotak Personal Loan on Credit Card can go up to 3% of the loan amount plus applicable taxes.
4. ICICI Personal Loan on Credit Card
ICICI Bank offers a Personal Loan on Credit Card with a maximum loan amount of up to Rs 10 lakh with a maximum repayment tenor of 60 months. ICICI Bank offers attractive interest rates on the Personal Loan on Credit Card, and as it is a pre-approved loan, there is no requirement for documentation and the loan disbursal process is quick.
5. Standard Chartered Credit Card Loan
Standard Chartered Bank offers a Personal Loan on Credit Card with a maximum loan amount of up to Rs.7.5 Lakh. The bank offers the borrowers a flexible repayment tenor ranging between 12 to 60 months. The interest rate charged against Credit Card Personal Loan at Standard Chartered Bank starts from 1.17% per month depending upon the eligibility of the cardholder. There is no documentation required, and the loan amount will be credited in the customer’s account within 2 business days.
It is advisable to gather information regarding all the charges and fees before availing a Personal Loan against Credit Card. You must also choose such a repayment tenor that gives you an EMI amount, which is easily affordable. With little caution and jurisprudence, you can easily maximize the benefits of Credit Card loans.