Are personal loans better than credit cards?

Credit cards are quick and easy to use but their popularity is waning. Personal loans are less flexible but often cheaper.

According to the Australian Prudential and Regulation Authority, at December 2012 personal loan balances totalled $58.6 billion and $40.8 billion was outstanding on credit cards.

The type of purchase is often the key to whether a credit card or personal loan will work best.

Credit cards are more convenient for retail purchases. A personal loan facility has to be set up in advance and is better for larger items like a car.

Source: Courier Mail

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