A personal loan is the kind of loan that proves to be useful when you are in great need of money. It is easy to take, and also has a quick disbursal process. As it is an unsecured loan, its interest rate is high. Also, one takes an instant personal loan when one is in dire need of money. Most don’t look at the interest rate at which the cash is available in such a time. Then again, at a later stage, there are ways to reduce the interest rate like with the help of a loan balance transfer.

The interest rates in personal loans are steep. Despite the fact, it is the type of loan that is the highest in demand. If you have been filling your credit card bills and loan EMIs on time and your credit score is correct, then it is effortless for you to get an instant personal loan. Many personal loan apps offer such a service. In fact, the money gets transferred into your account within a few minutes.

After you have utilised the money taken from your personal loan, it is time to reduce your interest. One way to reduce your interest burden is with the loan balance transfer. It reduces your interest rate and hence, makes your debt burden a little lighter.

What is a Balance Transfer

A balance transfer is a process in which your current loan is transferred from one bank to another. However, that is beneficial only when the bank to which you are moving the loan is ready to give you a lower interest rate than your previous financial institution or bank.

Again, your credit history is critical to get a lower interest rate. If your credit score is good, the other banks will readily offer you a loan more affordable than your current bank, at a lower interest rate. With a balance transfer, your EMI decreases as the balance gets transferred to another bank. In case your loan tenure is long, you’ll be able to spare some savings every month.

Advantages of Balance Transfer

There are many advantages to doing a balance transfer, like:

  • You can avail the balance transfer facility even in the midst of a continuing loan. You go for the balance transfer option only because of the low-interest rate. So, as you transfer your balance, your EMI decreases. Banks often offer attractive interest rates to pull the customer from their rival banks. Such a competition in the market turns out to be advantageous for you.
  • According to the market conditions, you do a balance transfer to a bank offering a lower interest rate. If you plan to do a balance transfer, you can negotiate interest rates further with your current bank. According to your credit history, the bank can offer you a new interest rate. You can choose between your current bank and other rival banks before transferring the balance.
  • Now if you switch banks, not only do you get the benefit of transferring balance at a lower interest from your existing bank, but you also get better services at the new bank.
  • At the current market price of your property, you get a new bank loan. Again, you may also take a top-up loan.

Things to Note

It is nice to know the fundamentals about the option of replacing your expensive loans with low-interest rate loans. But doing balance transfer right also requires some caution.


  • You must tell your old bank that you are getting a loan at a lower interest rate.
  • Ensure that after the balance transfer happens, your EMI gets reduced without any change in the loan tenure.
  • Also, transfer the balance only post knowing the processing fees and other such charges.
  • Note that the interest rate at which the new bank is offering you the loan must not be a teaser loan. In a teaser loan, you have to pay more interest at a later stage. For any of the cases, the balance transfer must be done only post calculating the total loan amount.

Getting an Instant Personal Loan From PaySense

PaySense is a personal loan app that has turned out to be pretty helpful for its users during the Coronavirus pandemic. In the times of social distancing, staying home and getting work done online is the preferred way. PaySense helps you do just that. The instant personal loan app benefits include quick disbursals, affordable EMI plans, instant approvals, and one-click subsequent loans. These and other benefits make PaySense a suitable lender for both salaried and self-employed individuals.