Personal Loans or Credit Cards: Which is Better for Salaried Employees ?

personal loan vs credit card

Today’s working professionals face financial problems in their daily lives. Making wise decisions can help people manage their financial problems.

This blog explains why salaried employees should consider a personal loan rather than relying only on credit cards.

What is a credit card?

Credit is a financial tool issued by banks and other financial institutions that allows cardholders to borrow money and use it to purchase similar goods and services from shops that accept cards. However, the borrowed money has to be repaid within the time specified, with added interest and other agreed-upon charges, either in whole or over time

What is a personal loan?

Personal loans are unsecured loans. It allows you to borrow money without collateral, and the borrowed money can be used for a variety of purposes, such as trip planning, business, or a dream wedding.

However, the borrowed funds must be repaid with additional interest on a monthly or yearly basis. Since your loan is unsecured, the lender will not seize your assets if you default on your payments. Defaulting on payments can harm your credit score.

Why a salaried employee should consider taking a personal loan?

In today’s world, as technology advances, banks and financial institutions provide customers with easy borrowing options. Banks and other finance companies, such as Zap Money, provide immediate personal loans to working individuals.

Getting money online has become simple in banks and finance companies, particularly for paid individuals. There are numerous benefits to taking out a personal loan as a salaried job.

Benefits of taking personal loan for salaried people:

1. Process for Documentation That is Easy:

Obtaining a personal loan for salaried individuals is simple, and the entire process can be completed online. it requires minimal documentation, and the process can be completed quickly.

2. Good Interest Rates:

Lower interest rates are possible for salaried individuals as well as those with a strong credit score. Banks and other financial organizations, such as Zap Money, offer decent interest rates in comparison to credit cards.

3. Medical Emergencies:

Unexpected situations, such as a medical emergency, can make it difficult to secure money. Personal loans are the sole choice to help you out of financial problems, since you get an liquid cash which you can spend anywhere compared to credit cards.

4. Travel Expenses:

People generally plan to go to new places or take a well-deserved holiday, but they cannot do so due to a lack of cash. However, it is possible to visit your dream destination by taking a personal loan for travel with lower interest rate compared to credit cards.

5. Loan Repayment Option:

Personal loans provide flexible repayment options based on your financial capability. you can repay your loan in 15 months or just three months.

Simply make sure that you have enough funds in your bank account when the repayment date approaches, as skipping an EMI payment may hurt your credit score. A credit card is useful,  only if you can pay the entire due within a month

Advantages of getting a personal loan from Zap Money instead of a credit card:

Zap Money Personal LoanCredit Card
Impact on Credit ScoreConstant repayment improves credit score slowlyPersonal loan repayment greatly improves credit score
Loan/Credit AmountThe loan amount credited to bank account can be withdrawn as liquid cash
Withdrawal of Liquid CashNo additional chargesCannot withdraw liquid cash
Policy and Charges100% Transparent loan policy, No pre-closure chargesHidden charges and penalties for pre-closure might be present
Approval/Issuance TimePersonal loan approval within 4 hrs for most casesAverage turnaround time for issuing a credit card is 3 days
Interest RatePersonal loan interest rate starts from 18% per annumMost credit cards charge more than 36% pa interest rate
Data ProtectionSafety data protection


Who is eligible for a personal loan?

Do personal loans depend on salary?

What are the advantages of a personal loan?

Why is a personal loan better compared to a credit card?

What is the difference between a personal loan and a credit card?

When you should consider a personal loan instead of a credit card?

Personal loan vs Credit card, which is better for EMI ?

Hariharan Ravichandran


The ZapMoney app makes personal finance easy, accessible, and affordable. The App is available on Google Play Store and App Store for download, allowing you to sign up and access easy personal loans. ZapMoney is powered by Monexo Fintech Private Limited which is a registered NBFC-P2P.
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