Find out Which Is the Right Choice for You – Personal Loan vs Business Loan
loan
India’s domestic credit market recorded an 8.4% year-on-year growth in January 2021, according to reports of a leading market analysis firm.
These two financial products are different in several aspects but also similar on parameters like – it’s challenging to obtain an instant loan for a low CIBIL score.
Hence, one needs to learn about these two financial products in detail to comprehend which one is the right choice.
Personal loan vs business loan – know the right product
Being unsecured loans, both financial products are quite similar in terms of their features and benefits
- Business loans
Business loans allow individuals to source the necessary funding to support their organizational expenses.
They can use this financing method to fund machinery purchases, invest in strengthening their existing infrastructuroanRemove term: Credit Market Credit Mare or increase their working capital to boost their venture’s financial viability.
The only limitation of a business loan is that it requires companies to have a vintage, which start-ups lack.
A personal loan can be an alternative for these enterprises.
- Personal loans
Personal loans are an ideal financing option to meet any monetary shortfall, be it planned or unplanned.
Since there are no restrictions on funds’ usage here, Individuals can use a personal loan for debt consolidation, medical expenses, funding educational expenses, etc.
Note that the usage flexibility extended by this financial product exceeds the scope of one’s personal expenses.
Personal loan benefits
The demand for this instant loan for a low CIBIL score has prompted it to account for 28% of India’s total credit market. The features of a personal loan include –
- Collateral-free: This financial product does not require any collateral. It means individuals can obtain one without pledging any asset or guarantee. It is one of the factors that make unsecured personal loans popular.
- Competitive interest rate: Leading NBFCs extend low-interest personal loans to reduce borrowing costs and make repayments more affordable.
- Online application: Individuals can save time by applying for personal loans online. Borrowers can fill out the form online and submit the required documents to complete this process without any hassle.
- Repayment flexibility: Additionally, the repayment flexibility offered by reputed lenders also increases the convenience of borrowers.
- Quick approval: The approval process of best personal loans is also swift and hassle-free, and one can get the required funds within 24 hours. For business loans, this process is relatively tad dragged out.
Along with this, the eligibility criteria for a personal loan also make it a convenient one to avail. Borrowers with a good CIBIL score, i.e. above 750, can easily opt for this financial product.
Furthermore, the availability of pre-approved offers also helps with the borrowing experience.
They simplify the loan application process and save time. These offers apply to various financing options like business loans and personal loans.
Prospective borrowers can check their pre-approved offers by submitting essential contact details like name, contact number, etc.
The reputed financial institution, Bajaj Finserv, extends such offers to its existing customers. Individuals can call the Bajaj Finserv customer care number to learn more about such offers and other loan details.
Instant loan for a low CIBIL score is challenging to avail, be it for business or personal purposes.
Nevertheless, personal loans and business loans are two separate products, and despite their similarities, they cater to different requirements and differ on eligibility requirements.
Therefore, individuals who are planning to borrow quick funds must consider those differences to make an informed decision.
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Category: Financial Planning
