Features & Benefits of Credit Card Loan
Given below are some of the key features of loan on credit card:
- Pre-approved Offers – Loan on credit card is extended to the existing cardholders after a thorough assessment of their credit profile and repayment behaviour. Loan eligibility and maximum eligible loan amount is communicated to the cardholders via SMS, email or WhatsApp.
- Quick Disbursal – Since these are generally pre-approved, loan disbursal is swift and hassle-free.
- Loan beyond Available Credit Limit – Some banks may also offer loan on credit cards beyond the credit limit available on your card. The maximum eligible amount, however, depends on a lot of factors like income, existing debt and the bank’s internal policies.
- No Additional Documents – In most cases, there is no additional documentation required for pre-approved loans against credit cards.
- No Collateral – No collateral is required to obtain funds through credit card loans; eligibility solely depends on the bank’s internal policies.
- Tenure up to 5 years – Most banks offer loans against credit cards for a period of up to 60 months or even higher, depending on the lender’s policies.
Who is Eligible for a Loan Against Credit Card?
Existing credit cardholders who have consistently shown responsible repayment behaviour are more likely to be eligible for a loan on credit card. From time to time, banks extend pre-approved loan offers to select individuals but this could be available for a limited time only.
Cardholders who have not received any pre-approved offer for loan on credit card can consider speaking to their card issuer’s customer service helpline to check their eligibility for the same. However, the final approval remains at the sole discretion of the bank.
How to Apply for Credit Card Loan
Eligible cardholders can apply for a loan on credit card through net banking, mobile banking or through their bank’s mobile apps. Some banks also send pre-approved credit card loan offers via SMS and consumers can follow the link given in the SMS to apply.
While the process may vary from one card issuer to another, here are the general steps that you would have to follow to apply for loan against credit card.
- Login to the net banking portal of your bank. You can also follow the link received on SMS to start the process.
- Choose the loan amount and loan tenure and check the EMI amount
- If satisfied, proceed by providing other details
- If required, provide necessary documents like ID proof, address proof and income proof
- Authenticate with OTP received
Once submitted, the bank will review your application and disburse the amount if satisfied. Mostly, in case of pre-approved loan against credit card, additional documentation is not required and the loan is disbursed immediately.
Loan on Credit Card vs Personal Loan
Loan on credit card is a type of personal loan offered to existing credit cardholders who have consistently shown responsible credit behaviour. As compared to personal loans, the interest rate on loan against credit card is slightly higher and the eligible loan amount could be comparatively lower. However, this may vary from one cardholder to another.
Here are some key differences between loan against credit card and personal loans:
| Parameter | Loan on Credit Card | Personal Loan |
| Loan Amount | Depends on the applicant’s credit profile | Depends on the applicant’s credit profile |
| Interest Rate | Starting at 0.99% p.m. | Starting at 10.5% p.a. |
| Processing Fee | 1-2% of the loan amount | 0.5% to 4% of loan amount |
| Loan Tenure | Up to 60 months | Up to 8 years |
| Disbursal Time | Instantly in case of pre-approved loans; may take 4-5 business days otherwise | Instantly in case of pre-approved loans; may take 7-10 business days otherwise |
| Documents Required | Generally not needed if there’s pre-approved offer; else ID Proof, Address Proof and Income Proof | Generally not needed if there’s pre-approved offer; else ID Proof, Address Proof and Income Proof |
Documents Required
Usually, loan on credit cards are offered to select cardholders on pre-approved basis. In such cases, no documents are required. However, the issuer may ask for certain documents on case-to-case basis. Here is an indicative list of documents:
| Proof of Identity | PAN Card, Aadhaar card, Driver’s License, Passport, Voter’s ID, Overseas Citizen of India Card, Person of Indian Origin Card, Job card issued by NREGA, Letters issued by the UIDAI or any other government approved photo ID proof |
| Proof of Address | Aadhaar card, Driver’s License, Passport, Utility Bill not more than 3 months old, Ration Card, Property Registration Document, Person of Indian Origin Card, Job card issued by NREGA, Bank Account Statement or any other government approved address proof |
| Proof of Income | Latest one or 2 salary slip (not more than 3 months old), Latest Form 16, Last 3 months’ bank statement |
Top Banks/NBFCs Offering Loan on Credit Card
Almost all leading credit card issuers offer loans against credit cards to eligible consumers. Here are the details:
| Bank | Interest Rate | Processing Fee |
| HDFC Bank | Insta Jumbo Loan: 14.85% p.a.
Insta Loan: 16.85% p.a. |
NA |
| ICICI Bank | Starting at 13% p.a. | 1% of the loan amount |
| Axis Bank | Average ROI of 16.35% | 2% of the loan amount or Rs. 500, whichever is higher |
| SBI Card | Communicated at the time of sourcing | 2% (min. Rs. 499, max. Rs. 3,000) |
| IDFC FIRST Bank | Communicated at the time of sourcing | 2% of the loan amount or Rs. 499, whichever is higher |
| Kotak Mahindra Bank | 12% to 25% p.a. | Communicated at the time of sourcing |
| Standard Chartered Bank | Starting at 0.99% p.m. | 1-2% of the loan amount |
Note: Interest rates for HDFC Bank and Axis Bank are shown for Q4 2025 (Jan ‘25 – Mar ‘25)
FAQs
Q. What is the difference between credit card loan and personal loan?
Credit card loan, also known as loan against credit card, is offered to select credit cardholders, based on their credit limit, repayment behaviour, etc. Personal loans are available to individuals, irrespective of whether they hold a credit card. Loans against credit cards generally charge a higher interest rate than that on personal loans. In case of loan against cards, the loan amount may be limited to the existing credit limit. With personal loans, you may be eligible for a larger sum at a comparatively lower rate of interest.
Q. How can I get an instant loan on my credit card?
If you have pre-approved offer for a loan on credit card, you can opt for the same from your respective bank’s net banking or mobile app. In most case, pre-approved loans are instantly approved and the amount is transferred to your bank account within a few minutes.
Q. Can I get a credit card loan without income proof?
In case of pre-approved credit card loan, you may not be required to submit income proof but this may vary on case-to-case basis.
Q. How much loan can I get on a credit card?
Banks set the eligible loan amount basis your credit limit, credit score, current liabilities and other internal factors.
Q. Can I convert my credit card dues into a loan?
Yes. You can convert your credit card outstanding balance into a loan and pay off in easy EMIs. If this option is not available, you can also take a personal loan to cover the debt.
Q. Can I pre-close the loan on credit card?
Yes. Most lenders allow pre-closure of credit card loans. However, pre-closure charges ranging from 2-4% of the remaining balance may be charged.
Q. Will credit card loan affect my credit score?
Yes. Credit card loan is treated as a separate loan account and has a direct impact on your credit score.
Q. Is there any processing fee for loan against credit card?
Yes. Loan against credit card comes with a processing fee usually ranging from 2% to 5% of the loan amount, subject to a maximum cap.