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Top-up Loan or Personal Loan?

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Top-up Loan or Personal Loan?


A personal loan can be utilized for multiple reasons. Regardless of whether you require the funds for paying the dues, clearing medical bills, or any personal reasons, you can easily apply for a personal loan to avail yourself of finances conveniently. One plus point of helping with an instant personal loan is that it is unsecured. Thus the borrower is not required to pledge collateral to get the necessary funds. Nowadays, you can access funds in a shorter duration, so the verification process has become much quicker and hassle-free. If you urgently need funding to deal with a financial emergency, the best option is to apply for an instant loan. However, you must ensure you are eligible for a loan to maximize its benefits.

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What is a Personal Loan?

A personal loan is an unspecified amount a person borrows from a bank, or any other financial institution, to meet a unique need/requirement. A personal loan can finance anything from home renovations and European vacations to your child’s education and unexpected medical expenses. Personal loans are also helpful in investing in businesses, fixing your car, making a down payment for a new home, etc. Interest rates can range depending on your credit history, tenure, income, occupation, etc. The rates are fixed and not floating rates.

What’s a Top-Up Loan?

Banks and other financial institutions provide a top-up loan facility. By doing that, the loan borrower can lend a certain amount of money. This is then added over and above your current personal loan, a home loan, or any other such loan. Anyone with an existing Home Loan, Gold Loan, or Personal loan can avail of a Top-Up Loan. Tax deduction benefits are also available on a top-up loan for the interest portion under section 24. Most banks and financial institutions offer top-up loans readily to their existing customers.

Eligibility Criteria

Personal Loan

To avail of a loan, you need to be eligible for the same. It would be best to meet the essential loan eligibility criteria for an instant personal loan.

Top-Up Loan

Lenders will allow such a loan only if you have already taken a loan earlier and have been steadily paying back the loan amount for at least over one year or as mentioned in the document. The repayment track record of your loan is one of the most important factors the lender considers. This will determine whether you are eligible for a personal top-up loan.

These loans are meant primarily for those individuals who require extra money to construct the property. Secondly, the interest rate charged on top-up loans is significantly less than on personal loans. Personal loan funds can be used for various purposes, like medical emergencies, financing higher education, holiday trips, wedding expenses, business expansion, consolidating debts, etc. However, you must apply for a reliable bank or financial institution loan. Online banks and lending institutions have their loan app to apply for a loan online on their phone.

With the Finserv MARKETS app, you can avail yourself of a personal loan for all financial needs at attractive interest rates. Whether you want to plan your travel, purchase a home, or finance your wedding expenses. The entire loan application process is online through the Finserv MARKETS app and requires minimal documentation. You also get personalized pre-approved offers, instant approvals, and flexible tenures of 12 to 60 months on your loan. Once your loan gets approved, you can have your loan amount disbursed within 24 hours.

Eula Boone

I have written professionally since 2010 and have been an investor since 2015. My finance blog, economydiva.com, is one of the most visited blogs in the world, with more than 3 million readers a month. I love sharing what I know about investing, saving, and managing money and providing practical tips on how to be a smart and savvy money manager.