Both are buying, pay later (BNPL) and personal loans are popular credit options – but they serve very different objectives. Although BNPL is often used for short -term purchases, small tickets, personal loans are better suited to larger, planned or emergency expenses.
In this blog, we decompose the differences between BNPL and personal loans, compare costs, flexibility of reimbursement, the impact on credit scores, etc. If you do not know which one is best suited to your financial needs, this guide will help you make an informed decision.
BNPL is a short -term financing option that allows you to divide the cost of purchase in smaller and uninteresting payments. You will often find BNPL options during your online purchases for electronics, clothing or travel reservations.
BNPL is ideal for small purchases you can refund in a few weeks or months.
A personal loan is an unwanted loan which gives you a lump sum that you reimburse in monthly payments (EMI) over 6 months to 5 years.
| Postman | Bnpl | Personal loan |
|---|---|---|
| Aim | Small instant purchases | Large average expenses |
| Loan amount | 1,000 to 50,000 ₹ (approximately) | 5,000 to 20 ₹ + Lakhs |
| Mandate | 15 days to 6 months | 6 months to 5 years old |
| Interest | Generally 0% (short term) | 10% to 24% PA |
| Documentation | Minimal or none | Pan, Aadhaar, salary slips, bank statements |
| Credit check | Often not necessary | Mandatory |
| Impact on the credit rating | Cannot run for credit offices | Monthly |
| Availability | At the checkout on certain platforms | Via loan applications or banks |
Which one is cheaper?
The BNPL seems cheaper because it is often accompanied by 0% interest in short durations. But miss a payment can lead to: – Delay fees – Interest on the suffering amount – Account suspension
Personal loans are delivered with fixed interests and clear reimbursement calendars. You always know what you need and when.
If you plan to reimburse more than 6 months or borrow more than 5000 ₹, a personal loan is more predictable and safer in the long term.
What is easier to get?
BNPL is extremely easy to access: – Available instantly at the checkout – No need to submit documents or undergo credit checks
Personal loans make more efforts: – Requires income verification, credit checks – Approval time can vary from a few hours to 1 to 2 days
That said, once you are approved for a personal loan, the amount is credited directly to your account and can be used for anything – not just one purchase.
Impact on your credit scoring
BNPL:
Some suppliers do not report refund to credit offices. Thus, paying on time may not improve your credit scoring. However, the default values may have an impact on your credit file.
Personal loans:
Always reported. Refunds in a timely time can help create your credit profile. But missed payments will reduce your score.
If you build or improve your credit, personal loans are the best option.
Learn to improve your credit scoring for faster loans approval.
Reimbursement flexibility and mandate
BNPL: – generally fixed tenure (3 to 6 EMI) – No prepayment options – less flexibility on the dates due
Personal loans: – Flexible mandate from 6 months to 60 months – may reimburse early (may include early reimbursement fees) – EMI can be automatically debit on the date chosen
If you need flexibility of reimbursement or if you want to reduce the burden of EMI, personal loans offer more control.
When should you choose BNPL?
Opt for BNPL SI: – You make a small ticket purchase (<5000 ₹) - The merchant offers 0% interest - you can easily reimburse in 1 to 3 months - you do not want to go through a loan approval process
BNPL works well for: – Gadgets – Fashion & Lifestyle – Courts Voyages – Reservation tickets
When should you choose a personal loan?
Choose a personal loan if: – you need 5000 ₹ or more – your refund calendar is longer than 6 months – you want to improve your credit profile – you need funds for multiple or urgent purposes
Personal loans are ideal for: – Medical emergencies – Home repairs – Higher education – Wedding or relocation
You can even opt for a Salary loan in advance If you need funds before the salary.
Choose according to needs, not just convenience
BNPL is ideal for small fast payments without documentation. But it does not offer flexibility or credits.
Personal loans, although slightly more difficult to obtain, offer larger amounts, longer mandates and financial discipline.
Make your choice according to: – loan amount you need – Refund capacity – Credit objectives – long -term affordability
Are you looking for a personal confidence loan supplier?
Loantap offers personal loans From 5,000 to 10,000,000 ₹ to ₹ with flexible mandates, minimum documentation and rapid disbursements.
Apply online in a few minutes and access funds adapted to your needs.
Faq
Q1. Is BNPL a loan?
Yes, BNPL is a form of short -term credit that allows you to postpone payments. However, it generally does not require formal loan or credit check documentation.
Q2. Does BNPL affect your credit scoring?
Only if the supplier indicates. Many BNPL services do not report positive reimbursement history but may report default defects.
Q3. Are personal loans better for long-term loans?
Yes. Personal loans are delivered with fixed mandates and EMI, which makes them more suitable for long -term financial planning.
Q4. Can I prepare a BNPL plan?
Most BNPL suppliers do not allow an early closure or repayment. You have to stick to the EMI schedule.
Q5. Is distant a BNPL supplier?
No. Loantap provides personal loans, including products such as salary loans in advance, loans without EMI, etc. – Not the BNPL services.
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