Personal loan is defined as having a loan transaction between the loan provider and the borrower. It follows all of the same rules, terms and conditions of the loan. How this loan is different from the rest is that the loan credits the borrower and it is up to the borrower’s integrity and ability to spend that counts in the loan.
An example of such personal loan is the credit card. Credit cards are very popular and useful in our society and it has benefited us a lot in terms of the efficiency, convenience as well as the purchasing and payment aspect.
A credit card is a classic example of a source for a personal loan. It allows the user to just sign against a purchase instead of carrying a lot of cash in their wallets instead. It also allows convenient payment through other mediums like the internet. The credit card has revolutionized society by making payment easy. With its high loan limitations of up to S$15000 or above depending on the income group of the user, we can spend beyond our normal expenditure instead of depending on the hard cash that we carry around in our wallet only. It makes payment so easy with just a signature instead of counting money. It also helps the cashier with the banking instead of counting dollar bills and coins in our wallets
Credit cards can be used for payment, bills, high end purchases, and payment methods ranged from signatures, thumbprints, scanning or just a swipe away. Payment has never been so efficient and purchases have never been so carefree. Of course with such privileges, one has to exercise discipline too. The limit on the credit card is still a limit and there are folks who crossed the limit and have to pay an even higher amount. Some misuse the privileges of the credit card until the debt incurred is so big that they could not repay, and have to resort to reason, court cases or made a police report out of.
Efficient or convenient, the principle of the personal loan still follows the guidelines of a loan. Whatever is borrowed has to be returned and the borrower is subjected, and obligated to follow the rules of the loan the moment he or she has decided and is granted the loan privilege.