Most loans that are issued by people are taken for small needs. At the same time, going to the bank, the applicant often asks the question, what is more profitable for him-to ask a financial institution for cash or a credit card? Both banking products have their advantages and disadvantages, so to make the right choice, you need to understand well what is preferable in which situation.
General and miscellaneous
Both credit cards and consumer loans serve almost the same purpose. With their help, borrowers buy household appliances, furniture, go on vacation, etc. These banking products also have other common features. To obtain any of these loans, the applicant will need a minimum number of documents, which can only consist of a passport and an identification code. Even a certificate of income of an individual is required only in cases when the borrower needs a more substantial amount.
For both cash loans and credit cards, banks set fairly high annual rates, which average 25%. At one time, the main advantage of a cash loan was the high speed of its registration, because the funds could be received within a couple of hours after submitting the application, while the credit card had to wait for half a month. Now that banks have introduced nameless plastic cards, this difference has disappeared. However, some distinctive features still remain.
What, and in which case should I register?
Over the past year, the popularity of credit cards among the population has increased by more than 60%. The cash loan is somewhat behind in this respect, but this does not mean that it has completely lost its position. In some situations, it is a cash loan that looks preferable to a credit card. For example, “live” money will be more useful if the borrower has planned a one-time large purchase.
It can be a refrigerator or a vacation trip to some exotic country where there are not so many ATMs. By the way, the problem with ATMs is present not only in remote parts of the world but also in our country. It is their insufficient number that largely hinders the promotion of credit cards in the banking services market. In addition, they will only have to pay for the money that was spent, and not for the entire credit limit available on the card account. This makes the credit card more practical for small everyday expenses.