Q1. Is a credit card or personal loan better for emergencies?

Ans. A credit card is better for short term emergencies because it offers instant access and an interest free period. However, for large emergencies, a personal loan is more affordable due to lower interest rates.

Q2. Which has lower interest – credit card or personal loan?

Ans. A personal loan has much lower interest than a credit card. Credit cards usually charge 30% to 45% annually, while personal loans typically range between 10% and 24%.

Q3. Can I convert credit card spending into EMI?

Ans. Yes, many banks allow credit card purchases to be converted into EMIs. However, even EMI conversions on credit cards usually cost more than a personal loan.

Q4. Does a personal loan affect credit score more than a credit card?

Ans. Both affect your credit score equally. Timely EMI payments improve your score, while missed payments or high credit card usage can reduce it.

Q5. Which is better for large expenses – credit card or personal loan?

Ans. A personal loan is better for large expenses because it offers lower interest, fixed EMIs, and predictable repayment.

Q6. Is a credit card considered a loan?

Ans. Yes, a credit card is a type of unsecured revolving loan, but it works differently from a personal loan, which has fixed EMIs and a defined repayment period.

Q7. What is the best way to borrow money without high interest?

Ans. For small short-term needs, use a credit card and pay in full. For large or long term needs, a personal loan is the best way to borrow money with lower interest.