5 Benefits of Getting a Personal Line of Credit - Loan Trivia

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Monday, 9 December 2019

5 Benefits of Getting a Personal Line of Credit


A line of credit is a combination of a conventional loan and credit card. A personal line of credit is a unique credit service provided to meet financial needs, also known as revolving credit is offered by Non-Banking Financial Companies (NBFCs) and other lenders. A line of credit is of great use when you require funds in dire needs. There are times when you are suffering from a financial crunch, in these tough patches, a line of credit helps in a great way to fulfil financial needs. There are certain unpredicted events such as automobile repairs, major medical expense, and so on where in you need urgent cash. In such a case, a personal line of credit is the best option.
When it comes to getting a personal loan , there are diverse Non-Banking Financial Companies (NBFCs) which are leading this credit segment. Under a line of credit provision, you are provided with a specific amount, and as soon as the amount is assigned, you can withdraw and use the money flexibly. However, it is important to make sure that there is a prescribed limit within which you can use the funds. Apart from this, there are several benefits which make a line of credit the most favourable option:

1. Low-Interest Rates: The interest rates on personal line of credit is the most favourable one. Unlike the other forms of loan, wherein you have to start paying the rate of interest on the principal amount regardless of how much you use. However, under the line of credit, you are required to pay rate of interest only on the amount that you use and not what you withdraw.

2. Lower Instalments: A line of credit instalment is pretty convenient as compared to a conventional loan and that is because the repayment depends upon the usage. Since you are entitled to repay the amount only when you use it, the instalment under the line of credit is considerably lower.

3. Flexibility: A line of credit offers flexibility. You are free to choose the amount you want to withdraw along with the repayment plan. However, the repayment period lies between 24-60 months. i.e. 2 to 5 years.

4. No Collateral: One of the biggest benefits of a line of credit is that you do not need to submit a collateral when availing it. Furthermore, you do not require to submit the proof of your assets. This makes a line of credit is one of the most attractive credit avenues.

5. No Hidden Costs: A line of credit service is straightforward. You do not have to pay any charges or fees on the amount you withdraw. Furthermore, there are no withdrawal limits. Thus, you can withdraw as many times as you wish.


The personal line of credit offered by highly certified NBFCs is up to INR 25 lakhs. When you are looking forward to availing a flexi personal loan, it is essential that you approach NBFCs as they are more flexible with their plans and policies when compared to banks.

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