How To Apply for A Credit Card Loan in India?
As per stats released by the Reserve Bank of India, out of the total credit availed in the non-food sector for FY 2018; personal finances acquired a sizable share of 96%. Given the popularity of this advanced type, it is evident that a big chunk of Indians seeks substantial liquidity.
While various financial institutions provide these personal finances on meeting specific eligibility, credit card holders do not need to go through such hassles. These payment cards issued by reputed financers also come with the facility of a credit card loan.
A type of personal advance, loan on credit cards is a specific feature that allows individuals to meet their big-ticket funding requirements with ease. Individuals owning these cards can thus apply for a loan against the card with their respective financial institutions.
Before going into the application process of a credit card loan, here’s a quick overview of this facility.
Loan on credit card – An overview
A loan on a credit card is an advance extended against the cash limit available with the card. You must identify specific reasons to opt for a loan on a credit card to decide on the loan amount. The amount you can avail, however, depends on the unused limit of credit within a billing cycle.
Understand it with the help of an example. If the credit limit of your card is Rs.80,000, and its cash withdrawal limit stands at 20%, a loan of up to Rs.16,000 can be obtained (i.e. 20% of Rs.80,000.) Further, loan availability on credit cards also varies as per one’s utilisation of available credit limit. Thus, if you have utilised up to Rs.65,000 of the total credit limit, your cash and credit limit will reduce to Rs.15,000, thus affecting the loan availability (Rs.80,000 – Rs.65,000.)
Availability of instant cash thus simplifies one’s need to avail funds in a lump sum immediately. Such loans thus extend credit card use beyond just day-to-day transaction requirements.
Now, take a look at the process to apply for a loan on a credit card.
Steps to apply for a loan against credit card
As you already have met the necessary eligibility criteria required by your financer and have access to the credit limit, meeting any additional eligibility is not required. You can directly contact your card issuer for the advance.
Thus, the steps to apply for a credit card loan include the following.
Step 1 – Go to the official website of your card issuer.
Step 2 – Log in to your account with provided username and password.
Step 3 – Enter the number of your credit card against which you want to avail advance.
Step 4 – Opt for the loan facility available for your card.
Loans against credit card offer among the shortest turnaround as there are no documentation and eligibility verification processes involved. Alternatively, you can also approach the nearest branch of your financial institution to apply for the credit card loan.
Now, take a look at other essential features of the loan that make it a suitable funding option. Availing these loans and utilising their accompanying features is one of the ways to use your credit card wisely.
A quick look at the features of a loan against credit cards
- Pre-approved limit
Some of the best credit cards in India come with a pre-approved loan amount based on its credit limit.
- Access to instant finance
The quick and hassle-free process of application and disbursal makes the advance instantly available if the need be.
- Interest-free advance for up to 90 days
Individuals can avail and utilise the finance for up to 90 days without paying any interest to the lender.
This unique credit card use thus makes the payment instrument a must-have to fulfill immediate liquidity requirements.
Plus, although charges are applicable for the processing of such a loan, with payment cards like the Bajaj Finserv RBL Bank SuperCard, the processing fee stands at flat 2.5% of the loan amount. It thus makes availing these advances affordable too.
Additionally, Bajaj Finserv also makes financing quick, convenient, and help save applicant’s time via their pre-approved offers. You can avail of these offers on several financial products, which also include personal loans, business loans, home loans, etc. All you need to do is provide a few essential details like your name and contact number to check your pre-approved offer.
As for loans against credit cards, it is essential to select a card issuer carefully to make the most of these benefits. Also, take care to check other credit card features like interest-free cash withdrawal from ATM, convenient repayment, and more to choose the right credit card and maximise its utilisation.