Loan against PPF vs Personal Loan: Key differences and Benefits Explained

To meet expenses to these Diwali, aspiring lenders have different loan options. Two of these are PPF-based loans and personal loans. PPF-based loans are secured, low interest and limited to 25% of the PPF balance. A personal loan, on the other hand, is unsecured and based on the lender’s creditworthiness. Furthermore, personal loans are ideal for greater financial needs, such as weddings, travel, education and medical operations, with no restrictions on the use of the borrowed funds. Loan against PPF vs Personal Loan Function Loan against PPF Personal loan loan amount to 25% of the PPF bald based on creditworthiness and revenue interest rate generally 1-2% above PPF rate (~ 7.1%) from 9.99% per year of leading banks. Collateral secured by PPF balance that is unsecured in the term of nature repayment up to 36 months 12 to 60 months. It offers lenders more flexibility. Number of loans per year Once a financial year, multiple loans can be used per year, depending on one’s creditworthiness and the repayment potential impact on PPF balance, still earn interest if the loan is repaid in time. No limitation of impact use no major restrictions No restriction processing time longer, more formal process Quick payout online, provided the suitability conditions are met. Note: The differences and features of loans against PPF and personal loans discussed above are for illustrative purposes. Consult the official website of the various lending institution for the most recent interest rates, conditions and conditions. What are the risks of personal loans? As a wise borrower, it is essential to clearly understand and acknowledge the risks and restrictions associated with loans. High interest costs, collateral risk risks, credit values ​​implications, and the possibility of damage to credit profiles if repayment is not done on time, as well as the potential for debt build -up and psychological problems, are just some of the associated restrictions that the lender must definitely understand and consider before applying for a personal loan. Finally, the loan against PPF is a more affordable loan option that lenders can provide modest amounts and can help them to fulfill their short -term obligations. While personal loans provide higher comfort and flexibility. It offers lenders larger amounts at higher interest rates, but with faster access. Visit here for all personal finance updates. Disclaimer: Mint has a partnership with Fintech businesses to offer credit; You must share your information if you apply. These bonds do not affect our editorial content. This article aims to educate readers and raise awareness about the essential needs of credit, including loans, credit cards and credit values. Mint does not promote or encourage credit because it comes with risks such as high interest rates and hidden costs. We advise investors to discuss with certified experts before taking credit.