Small Personal Loan

Consumer Durable Loan Vs Small Personal Loan

July 18, 2023 • 2305 views

When it comes to financing your purchases or fulfilling your immediate financial needs, you may come across various loan options available in the market. Two popular choices are Consumer Durable Loans and Small Personal Loans. While both serve a similar purpose of providing financial assistance, they have distinct characteristics and features. 
Understanding the differences between Consumer Durable Loans and Personal Loan is crucial to making an informed borrowing decision. Keep reading to get a comparison of Consumer Loan vs Small Personal Loan.

What is a Consumer Durable (CD) Loan?

A Consumer Durable Loan is a type of loan that you can take to buy consumer durable products like appliances or gadgets. These loans allow you to buy appliances or gadgets now and pay for them in affordable instalments over a short time. 
Typically, CD loans are collateral-free, but some lenders do provide consumer durable loan as secured loans. Therefore, it is important to learn the lender’s policies first before applying.

What is a Small Personal Loan?

A Small Personal Loan is a type of loan that does not require you to provide any collateral or security. It is designed to help you with a smaller amount of money to meet your immediate financial needs and can be used for different purposes like paying medical bills, covering education expenses, financing a wedding, consolidating debt, etc. 
These loans depend on factors like your income, creditworthiness, and the policies of the lender. Additionally, a Small Personal Loan comes with short repayment tenures and fixed or variable interest rates, depending on the lender you choose.

Consumer Durable vs Small Personal Loan

The following table provides a comparison of Consumer Loans vs Small Personal Loans:


Consumer Durable Loan

Small Personal Loan


Limited to purchasing large electrical goods and consumer durables.

Can be used for multiple purposes.


May or may not be required, depending on lender policies.

Usually does not need collateral.

Loan Amount

Starts from ?10,000 or more.

Ranges from ?50,000 to ?5 Lakh.

Repayment Tenure

Shorter, generally ranging from a few months to a couple of years.

Ranges from 3 months to several years.


Benefits of Consumer Durable Loan

Now that we know what a CD loan is, let us look at a few of its benefits:

  • Attractive Interest Rates: Many lenders provide Consumer Durable Loans at low interest rates. This makes it a cost-effective choice for individuals seeking to finance significant consumer durables without incurring additional interest charges.
  • Lower Foreclosure Charges: When it comes to Consumer Durable Loans, the charges for closing the loan before the designated period are lower compared to other loan types.
  • Minimal Documentation: Unlike other loan types, Consumer Durable Loans have a simplified documentation requirement. This means you need to provide minimal paperwork when applying for the loan. As a result, the loan application process becomes quicker and more convenient for borrowers.

Benefits of Small Personal Loan

Here are the benefits of a Small Personal Loan:

  • Collateral-Free Loan: One of the key advantages of a Small Personal Loan is that you can obtain it without having to provide any collateral. You neither have to offer any guarantee nor worry about your assets being seized if you fail to repay the loan.
  • Nominal Processing Fees: Many lenders offer Small Personal Loans with a minimal processing fee as low as 2.5%.
  • Flexibility in Usage: Whether it is for a wedding or to consolidate debt, a Small Personal Loan can be used for anything. It can also come in handy when you need immediate cash to fund emergencies, such as rent, medical expenses, etc.

ALSO READ :- 4 Factors That Make Small Personal Loans A Viable Borrowing Option

Examples of Consumer Durable & Small Personal Loan

In India, there are various consumer durable and Small Personal Loans available. Their respective examples are discussed below:

Consumer Durable Loan

The following highlights some examples of Consumer Durable Loans:

  • Appliance Loan: This loan is specially made to help you pay for everyday consumer items like fridges, washing machines, air conditioners, TVs, and more.
  • Furniture Loan: This loan is designed to assist consumers in financing the purchase of furniture for their homes or offices. It covers a wide range of items, including sofas, beds, dining tables, chairs, and other similar furnishings.
  • Electronic Gadgets Loan: This loan is available to individuals who wish to purchase electronic devices like smartphones, laptops, tablets, cameras, gaming consoles, and other similar gadgets.

Small Personal Loan

Here are some examples of a Small Personal Loan:

  • Medical Emergency Loan: This loan is specifically designed to assist with medical expenses in situations of emergencies or for medical treatments that are not entirely covered by insurance.
  • Wedding Loan: Individuals have the option to request a Small Personal Loan to finance various expenses related to weddings, including venue reservations, catering, decorations, photography, and other related expenditures.
  • Education Loan: You can get a Small Personal Loan to help with education expenses like paying for tuition, buying books and supplies, or even funding study abroad programs.

To Conclude

The choice between a Consumer Durable Loan and a Small Personal Loan depends entirely on the purpose for which you seek these funds. it is crucial to borrow responsibly, ensuring that you can comfortably repay the loan within the agreed-upon terms. By making informed decisions and managing your finances wisely, you can leverage the benefits of these loan options to achieve your financial goals and aspirations.

Frequently Asked Questions About Consumer Durable Loan

1.    What is another name for a Consumer Durable Loan?
Consumer Durable Loans also go by ‘CD loans’ or ‘CD Personal Loans’.

2.    Is a Consumer Durable Loan a good option?
If you need the money to purchase electronic gadgets or appliances, a consumer durable loan can come in handy as it offers good loan amounts, competitive interest rates, and flexible repayment tenures.

3.    Is it better to take a Small Personal Loan?
A Small Personal Loan can be considered a good option when you need immediate financial aid. It can be useful for emergencies, such as medical bills, and rent, or to cover daily expenses.


We take utmost care to provide information based on internal data and reliable sources. However, this article and associated web pages provide generic information for reference purposes only. Readers must make an informed decision by reviewing the products offered and the terms and conditions. Personal Loan disbursal is at the sole discretion of Poonawalla Fincorp.
*Terms and Conditions apply

poonawalla fincorp team

Poonawalla Fincorp Team

Our team of expert writers and editors are passionate about providing authentic and valuable information on finance. Our aim is to simplify financial and finance-related concepts. We strive to help our readers become more aware and empowered to make informed financial decisions.

Trending Topics

Contact Us logo Quick Apply CIBIL Score logo Free CIBIL Whatsapp logo Connect on WhatsApp