Due to the lower interest rates compared to credit cards and personal loans, a top-up loan serves as an excellent vehicle for debt consolidation. A borrower carrying high-cost credit card debt (often 24-40% p.a.) can utilize the cheaper credit from a top-up loan (approx. 9-10% p.a.) to pay off the expensive debt, effectively reducing their monthly interest burden significantly.
Due to the lower interest rates compared to credit cards and personal loans, a top-up loan serves as an excellent vehicle for debt consolidation. A borrower carrying high-cost credit card debt (often 24-40% p.a.) can utilize the cheaper credit from a top-up loan (approx. 9-10% p.a.) to pay off the expensive debt, effectively reducing their monthly interest burden significantly.