{"id":24506,"date":"2022-01-25T09:21:39","date_gmt":"2022-01-25T09:21:39","guid":{"rendered":"https:\/\/tata-blog.osian.dev\/blog\/?p=24506"},"modified":"2023-06-22T07:34:42","modified_gmt":"2023-06-22T07:34:42","slug":"what-is-a-personal-line-of-credit-is-it-feasible-for-an-average-indian","status":"publish","type":"post","link":"https:\/\/tata-blog.osian.dev\/blog\/personal-use-loan\/what-is-a-personal-line-of-credit-is-it-feasible-for-an-average-indian\/","title":{"rendered":"What Is a Personal Line of Credit? Is It Feasible for An Average Indian?"},"content":{"rendered":"\n

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Be it financial emergencies or big-ticket purchases; personal loan<\/a> have been the go-to loan option for Indians for a long time. And it\u2019s no wonder why \u2013 with zero collateral requirements and fast approval times, it really makes for an ideal financial instrument.<\/p>\n\n\n\n

However, they\u2019re no longer the only option available. With the introduction of a personal line of credit(PLOC), you now have another way to fulfil your financial needs.<\/p>\n\n\n\n

Let\u2019s explore what a line of credit is and how it works.<\/p>\n\n\n\n

What is a line of credit?<\/strong><\/h2>\n\n\n\n

Simply put, a line of credit is a pool of money that you can borrow from a lender and use as and when you need it. It is quite similar to a credit card, except that you don\u2019t have to carry a physical card with you.<\/p>\n\n\n\n

Also, PLOCs are unsecured in nature, meaning you don\u2019t have to give up any of your assets as collateral to get credit.<\/p>\n\n\n\n

Additional Read –<\/strong>Here is a List of Few Types of Personal Loans in India You Would Be Unaware About<\/a><\/p>\n\n\n\n

How does a line of credit work?<\/strong><\/h2>\n\n\n\n

The simplest way to understand how a line of credit works is to think of it as a cross between a credit card and a loan for personal use. With a line of credit, you have the option to withdraw money from the sanctioned credit limit whenever the need arises. The best part is, you pay interest only on the amount you withdraw and not on the entire line.<\/p>\n\n\n\n

For instance, if you have an LOC of Rs. 5 lakhs, and you withdraw only Rs. 1 lakh from it, you only pay interest on Rs. 1 lakh. What\u2019s more, once you pay back the amount you withdrew, you have the Rs. 5 lakh limit available once again.<\/p>\n\n\n\n

Also, personal line of credit interest rates are usually lower than that of credit cards.<\/p>\n\n\n\n

Should you opt for a PLOC?<\/strong><\/h2>\n\n\n\n

Since PLOCs allow you to draw up money from a line on an as-needed basis, they\u2019re a great financial tool for someone who makes regular purchases and doesn\u2019t want to dip into their savings. Also, since they\u2019re available at a lower interest rate than credit cards, you save more with a line of credit.<\/p>\n\n\n\n

However, it\u2019s important to note that lines of credit come with a variable interest rate model, meaning that the interest rate will change based on market conditions. This can be both good and bad. Also, lenders may charge annual fees for using their line of credit.<\/p>\n\n\n\n

Lastly, since a line of credit is a relatively new concept in India, not many lenders offer it. Thus, you may face a lack of options.<\/p>\n\n\n\n

Additional Read – <\/strong>What Is the Difference Between Personal Loan and a Personal Line of Credit?<\/a><\/p>\n\n\n\n

The bottom line<\/strong><\/h3>\n\n\n\n

If you\u2019ve got regular purchases to make, PLOC is clearly the financial instrument you should opt for. However, if you\u2019re looking for ways to cover emergencies or a big purchase, a loan for personal use might be the better choice.<\/p>\n\n\n\n

And for personal finance, no lender\u2019s better than Tata Capital. With our affordable interest rates, easy personal loan eligibility<\/a>, and fast processing speeds, you can have all the money you require in no time.<\/p>\n\n\n\n

Start planning your repayments by using our personal loan EMI calculator<\/a> today!<\/p>\n\n\n\n

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Apply Now<\/a><\/div>\n<\/div>\n<\/div>\n\n\n\n
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Be it financial emergencies or big-ticket purchases; personal loans have been the go-to loan option for Indians for a long time. <\/p>\n

Read More<\/a><\/p>\n","protected":false},"author":1,"featured_media":24507,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[24],"tags":[],"class_list":["post-24506","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-personal-use-loan"],"yoast_head":"\nWhat Is a Personal Line of Credit Is It Feasible for An Average Indian - Tata Capital Blog<\/title>\n<meta name=\"description\" content=\"Don\u2019t know what a personal line of credit is ? 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