Personal Loan Or Credit Card - Which Is Better for Travelling

Travel is a passion and a dream for many people. Some indulge in it on a smaller scale, like weekend trips, while others have grand plans like a world tour or a luxury cruise. Have you got a dream destination that has remained a dream? Or a wishlist itinerary that you have kept on hold due to budget constraints? If yes, you need not wait any more. With financial solutions like loans and Credit Cards, your travel dreams can finally come true.

People often get confused about which financial option is better suited for travel expenses – a Personal Loan or a Credit Card.  Let’s understand both avenues in detail in this blog post.

Personal Loan for Travel

The key benefit of a Personal Loan is that you do not have to pledge any security or collateral to get the loan. The loan amount is disbursed into your bank account in a lump sum and you can use it as you need- to book air tickets, make hotel bookings, as well as cover all other expenses related to your trip.  ICICI Bank offers Personal Loans at attractive interest rates to fund your dream vacation. You can get a maximum loan amount ₹ 50 lakhs at interest rates starting from 10.65% per annum. The loan is disbursed quickly, usually within seven working days, with simple documentation.

When you have travel plans in mind that need a significant amount of money in a limited amount of time, you can apply for a Loan Against your Credit Card. This works faster than traditional loans, since, as an existing customer of the Bank, you do not need to submit any paperwork. If you have a good repayment record on your existing Credit Card, availing a Loan on your Credit Card can make your travel comfortable and stress-free.

Another benefit of availing a loan is that the repayment process is flexible and you can space out your repayment in equated monthly instalments.

Credit Card for Travel

If you’re looking for instant credit to fund your travel plans, a Credit Card is an ideal option. You can opt for one of ICICI Bank’s Travel Credit Cards that come with travel-specific benefits like frequent flier miles, airport lounge access, discounts on travel and stay, reward points and much more. However, you are required to pay the amount due on your Credit Card at the end of every month. If you are unable to pay the entire amount, you are charged an interest on the unpaid amount.

Which is Better? Personal Loan versus Credit Card

Both solutions have their own advantages and drawbacks. You will have to bear a high interest rate if you avail a Personal Loan for travel but you can pay back the loan over a longer duration.

On the other hand, if you choose to swipe your Credit Card to make travel bookings or for spends while on holiday, you can enjoy benefits like discounts, cashbacks and complimentary airport lounge access. However, you have to repay the entire Credit Card bill amount in a month. Failure to do so will mean that interest will continue to accrue on the unpaid amount, leading to an unwanted debt burden. 

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