Updated on: 24 May 2023
Published on: 20 April 2019
Delay in getting your salary, sudden spike in your expenses due to festivities or medical emergencies can all require you to borrow funds to bridge gaps. Salary advances
and personal loans are both ways that you can access credit when you need it.
They both offer funds without collateral to salaried professionals. Let’s take a closer look at both.
A personal loan and a salary advance are both credit options that you can get. Are you wondering what is salary advance? This type of loan is a short-term loan that salaried professionals can opt for. You can use the funds for any purpose.
On the other hand, personal loans can be short-term and long-term. As a salaried employee, you can repay them over a period ranging from 1–5 years.
A salary advance is ideal when you are cash-strapped and want a quick loan to fund sudden expenses until your salary is credited. In contrast, a personal loan is an unsecured multi-purpose credit offered for any financial need by banking and non-banking financial institutions.
Usually, you get a higher personal loan amount as compared to a salary advance, but this depends on the lender. In some cases, your employer may offer you a salary advance. The amount you get is based on the next salary. In other cases, you can get a salary advance loan from financial institutions.
A salary advance from Fibe gives you the extra money you may need to sail through tough times. A salary advance also offers more flexibility than a personal loan. The repayment tenure goes from 90 to 730 days. You can choose the ideal duration based on your finances.
Since you pay back the salary advance loan in easy EMIs over the tenure you select, repayment is hassle-free. Fibe also allows you to repay the entire amount in one go without any foreclosure charges.
The most significant advantage of a salary advance is the ease and speed with which the loan amount is directly transferred to your bank account. To enjoy this convenience, all you need to do is download the Fibe app, share the requisite details, and await approval in 10 minutes.
You can do it all online with minimal paperwork. On the other hand, personal loans usually require you to share more documents and meet stricter qualifying criteria. Banks may take more time to approve a loan and transfer the amount. Thus, a salary advance is a cushion during a financial crisis when you urgently require money.
Most personal loans require you to have a good credit score. However, you cannot build your credit score overnight. So, if you have recently begun your professional career, you may not be able to borrow the required amount.
However, a salary advance from Fibe does not require you to have a credit score. This is the main difference between a loan and an advance. All you need to do to access funds up to ₹5 lacs is to download the Fibe app. Meet the eligibility criteria of the salary advance loan and apply in minutes online.
Now that you know what is salary advance and how it differs from a personal loan, you can make the right decision. While both can help you get access to funds, salary advance loans can help you meet short-term gaps with ease and speed. For instance, you may have moved to the metro for better career opportunities.
Whether it’s a new apartment or routine living expenses and transportation costs, residing in a metro city can be financially challenging. You may not be able to tide over a short-term money crunch despite conscious budgeting and savings. This is where a salary advance from Fibe can help. You can use this salary advance for assistance during a medical need, to pay your bills, or continue investing and pay it off with your next paycheck or in EMIs.
With no hidden charges and competitive interest rates that is only levied for the number of days you use the money, Fibe’s Salary Advance can help you meet your requirements affordably.
A salary advance from Fibe helps you finance a short-term cash crunch until you receive your salary whereas a loan is usually borrowed for a longer time and may be of a higher amount.
Getting a salary advance can help you tackle unexpected financial emergencies or bridge a shortfall until your salary is credited. You can avail of this facility if your organisation provides it or via financial institutions like Fibe. Since it is not dependent on your credit score, you can get it easily and repay it within a shorter duration.
No, getting a salary advance from Fibe is not taxable since it is not considered a part of your income.
Some types of loans include personal loans, home loans, car loans, business loans and loans against property. Advances include salary advance, overdraft facilities or bills of exchange that can be discounted.
Both these credit facilities appear under liabilities in a company’s balance sheets. This is because an organisation needs to repay them to become debt free.
Loans and advances are credit facilities that allow you to get funds and require you to repay them.
Category : Personal Loan
Need cash? Get up to ₹5 lacs instantly