Personal Line of Credit

Subtext- Learn in detail what is a personal line of credit. Check out the interest rates, eligibility criteria, documents, and application process.

A personal line of credit is a flexible financial option that provides access to a pre-approved credit limit. Unlike a traditional loan, a line of credit allows you to withdraw funds as and when required, up to the sanctioned limit. You pay interest only on the amount you use, offering better control over your finances.

This instant line of credit is suitable for managing varying expenses such as emergencies, planned purchases, or other financial needs. You can get a personal line of credit through Bajaj Markets, offered by its partnered financial institutions.

Here are some common ways you can utilise it:

• Address unexpected medical bills, car repairs, or other urgent financial requirements without delay

• Handle temporary cash shortages or balance recurring expenses without dipping into your savings

• Pay for renovations, repairs, or upgrades to your home at your convenience

• Cover school fees, tuition expenses, or other educational needs without applying for separate loans

• Plan weddings, family celebrations, or other significant occasions with ease

• Address working capital requirements or other minor business expenses flexibly

Here are the applicable interest rates and charges for a personal line of credit:

Disclaimer: The mentioned rates are subject to change at the lender’s discretion.

A personal line of credit is a revolving credit facility that provides flexibility in managing your financial needs. It allows you to withdraw funds as required, up to a pre-approved limit. Unlike traditional loans, you pay interest only on the amount you utilise, not on the total sanctioned credit. This makes it a convenient option for addressing variable expenses over time.

Until you use the line of credit, there is no interest charged, ensuring you pay only for what you borrow. Once you withdraw funds, interest accrues from the date of withdrawal. Repayment can be tailored to suit your financial situation, giving you the option to repay the entire outstanding balance at once or through manageable monthly payments. The tenure for repayment typically ranges from 2 months to 5 years.

Let us understand this with an example:

Imagine you have a credit limit of ₹2 Lakhs approved under a personal line of credit. If you withdraw ₹50,000 to cover a medical emergency, interest is charged only on this ₹50,000. If you repay this amount in a few months, your available credit returns to ₹2 Lakhs, and you can borrow again within the limit if needed. Additionally, if you decide not to withdraw any funds, you won’t incur any interest.

This flexibility makes a personal line of credit an ideal choice for managing fluctuating expenses efficiently.

A personal line of credit and a personal loan are two common ways to borrow money, but they work differently. Knowing these differences can help you decide which one suits your needs better.

A personal loan gives you a fixed amount of money all at once, which you repay in equated monthly instalments over a set period. Interest is charged on the full loan amount from the start, no matter how you use the money. Once you repay the loan, the account is closed, and if you need more funds later, you’ll have to apply for a new loan. This option is ideal for one-time expenses like buying a car, funding a wedding, or making a large purchase.

On the other hand, with a personal line of credit you are given a pre-approved limit and can use money whenever you need it. Interest is charged only on the amount you use, not the entire limit. Once you repay the borrowed amount, your credit limit is restored, allowing you to borrow again without applying. If you repay on time, the credit line stays open. This makes it a good choice for expenses that happen often, like home repairs, bill payments, or business needs.

To qualify for a personal line of credit, you need to meet the following criteria:

• You must be between 23 and 58 years of age

• You should be a salaried individual

• Your net in-hand income must be at least ₹20,000 per month

• Your salary must be credited directly to your bank account; cash salary is not accepted

To apply for a personal line of credit, you may need to provide the following documents:

• Address proof like a utility bill, rental agreement, or an Aadhaar card

• Valid photo identification such as a PAN card, Aadhaar card, or passport

• A live selfie taken on the spot during the application process for verification purposes

Choosing Bajaj Markets for a personal line of credit offers several advantages, such as:

• Quick Approval

You may enjoy fast approvals depending on how quickly you provide complete and clear documents and how promptly these factors are verified.

• Minimal Documentation

Submit only essential documents such as identity proof, address proof, and a selfie, simplifying the application process.

• Rapid Disbursal

Funds may get disbursed swiftly, subject to eligibility checks and lender policies, ensuring you have access to money when needed.

• Digital Processing

Your application is processed entirely online, enabling faster approval and immediate access to your credit line.

Here are simple steps to apply for a personal line of credit on Bajaj Markets:

1. Visit the website and select the ‘Check Offers’ option to begin

2. Fill in the online application form with basic personal information such as name, age, income, and employment details

3. Enter the desired credit limit and your preferred repayment tenure

4. Once all details are filled, submit the form for further verification

5. After submission, a representative will contact you to guide you through the next steps of the application process