APR 5.99% – 35.99%·$100 – $50,000

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Head to head

Personal loan vs credit card.

Both move money into your hands fast, but the math diverges sharply once you carry a balance. A personal loan has a fixed APR and a defined payoff date; a credit card has a variable APR that compounds monthly and a minimum payment that can stretch repayment over decades.

Side by side

Personal loan vs Credit card

AttributePersonal loanCredit card
StructureFixed installment loanRevolving credit line
APR range (typical)5.99% to 35.99%18% to 29%+
APR typeFixed for the life of the loanVariable, tied to prime rate
Loan amount$500 to $50,000Up to your credit limit
RepaymentFixed monthly payment, defined payoff dateMinimum payment, no payoff date
Time to fundNext business day after acceptanceInstant (existing card) or 7-10 days (new card)
Credit checkSoft inquiry at pre-qualification, hard at finalisationHard inquiry to open a new card
Origination fee0% to 8% of loan amountNone (but may have annual fee)
RewardsNoneCash back, points, miles on purchases
Best forPredictable payoff of an existing balance or one-time expenseShort-term financing paid in full each month, or rewards on routine spend
Verdicts by scenario

Which wins, when.

  1. 01

    Consolidating $5,000+ of card debt

    Winner: Personal loan

    Single-digit personal-loan APRs can save thousands vs 22%+ card APRs if you actually pay off the loan on schedule.

  2. 02

    Charging $500 you can repay this month

    Winner: Credit card

    Pay in full before the statement closes and you owe nothing in interest. Card wins on convenience for short windows.

  3. 03

    Financing a one-time $10,000 home repair

    Winner: Personal loan

    Fixed APR and defined term cost less and finish sooner than carrying a card balance at variable rates.

  4. 04

    Routine monthly spending

    Winner: Credit card

    If you pay statements in full, a rewards card with 0% effective APR plus cashback beats any loan.

Common questions

Frequently asked.

Will using a personal loan to pay off credit cards hurt my credit score?+

Usually no, and often it helps. The hard inquiry from the new loan and the new account dip your score a few points short-term. But paying down revolving balances drops your credit utilisation ratio, which is the second-largest factor in FICO scoring after payment history. Most consolidators see a net positive within 60-90 days.

What's the break-even point between a personal loan and a credit card?+

It depends on the APR spread and how fast you'd otherwise pay the card. Rule of thumb: if you'd carry the card balance for more than 12 months, and the personal loan APR is at least 3-5 points lower than the card APR, the personal loan saves money. Use our debt-payoff calculator to model both scenarios.

Can I use a balance-transfer card instead?+

Yes, and for some borrowers it's the cheapest option. A 0%-intro-APR balance-transfer card can beat a personal loan if you'll fully pay off the balance within the promo window (usually 15-21 months) and don't trigger deferred-interest billing. Once the promo ends, the card's APR usually reverts to 20%+.

Does a personal loan stay on my credit report?+

Yes. It shows up as an installment trade line for the life of the loan, plus 10 years after closure. Each on-time payment builds positive payment history; a missed payment damages it. Credit cards show as revolving trade lines and behave similarly, but their reported utilisation can swing month to month.

Other comparisons

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