Thinking about borrowing money in Singapore but worried about hidden fees and sky-high interest rates? It’s easy to assume that loans come with hidden traps—whether it’s hefty charges or rigid repayment plans.
But borrowing doesn’t have to break the bank. Whether it’s an unexpected medical expense or a home renovation project, borrowing should be manageable.
Two options stand out: traditional lines of credit (cashlines) vs. personal loans. But which one is better for you? We break down how daily interest rates and flexibility can make all the difference in what you end up paying.
Should you take a line of credit or a flexible personal loan?
- Understanding the basics: line of credit vs. flexible personal loan
- Daily interest rates explained: the true cost of borrowing
- Flexible loan tenures: what it means for borrowers
- Line of credit vs. personal loan: a side-by-side comparison
Understanding the basics: line of credit vs. flexible personal loan
Here’s a quick comparison between a line of credit vs. flexible personal loan:
| Line of credit | Personal loan | |
| Interest rate | Higher interest rate, usually around 25% p.a. | Lower interest rate, fixed monthly interest, ~1.9-3.5% p.a |
| Flexibility | Can withdraw anytime up to limit, instant access | One time loan disbursement |
| Repayment structure | No fixed end date, flexible payment above minimum | Fixed monthly installments, fixed loan tenure, structured repayment schedule |
| Better for | Short-term borrowing needs | Planned, larger expenses with structured repayment plans |
ALSO READ: Personal Loans 101: What You Need to Know (Intro Dummies Guide)
Daily interest rates explained: the true cost of borrowing
When borrowing anything from a financial institution, the first thing you need to know is the interest rate and how it affects your repayment amount.
A daily interest rate is your annual interest rate divided by 365 days, with interest calculated and charged daily on your outstanding balance rather than monthly. While this might seem like a minor detail, it significantly impacts your total borrowing costs over time.
With this in mind, taking a personal loan may be in your best interest (pun intended). Let’s look at the GXS FlexiLoan for comparison.
Here’s the math behind the savings: Say you borrow $10,000.
| Line of credit | GXS FlexiLoan | |
| Interest rate | 25% p.a. | 2.88% p.a. (EIR 5.45% p.a.) |
| Interest cost | $6.85/day | $1.50/day |
Over a year, this difference means GXS FlexiLoan users can save up to 4 times in interest payments compared to cashline users.
Hidden fees from traditional lenders can turn borrowing into a financial headache, but GXS FlexiLoan keeps it simple: no early repayment fees, no annual fees, and no late payment fees.
Most banks charge 1-2% of your outstanding loan for early repayment—up to $200 on a $10,000 loan. With GXS, you can repay anytime without penalties. Got extra cash from a bonus or side hustle? Use it to clear your loan early and save on interest.
What’s more, early repayment also saves you money on interest charges since you’re shortening your loan tenure. Why pay for 12 months when you can finish in 6? This kind of flexibility puts you in control of your finances, not the other way around.
ALSO READ: What Affects Personal Loan Interest Rates?
Flexible loan tenures: what it means for borrowers
Everyone’s financial needs are different, and GXS FlexiLoan offers tailored loan tenures from 2 to 60 months, letting you choose what fits your situation best.
Cashlines, on the other hand, lack structure, leading to indefinite borrowing and compounding interest. Even paying the minimum monthly amount can cause debt to snowball.
For instance, if Borrower A takes a $10,000 GXS FlexiLoan over 12 months but pays it off early after receiving a bonus, they’re debt-free sooner and saving more on interest.
Line of credit vs. personal loan: a side-by-side comparison
| GXS Flexiloan | Cashline | |
| Interest rate | From 2.88% p.a. (EIR 5.45%), daily rate 0.015%. | Typically 25% p.a., daily rate 0.068% |
| Flexibility | Structured repayments with freedom to repay early. | Revolving credit but high compounding interest. |
| Fees | Zero fees, plus enjoy interest savings if you repay early | Charges for annual usage, early repayment, and late payments. |
Smarter borrowing starts with the right choice
When it comes to borrowing, the key is finding what works best for your unique situation. A personal loan with a low interest rate and flexible terms can save you from paying more than you bargained for. GXS FlexiLoan offers just that—affordability (low daily interest) and freedom (no fees, flexible tenures), helping you save more and avoid hidden costs.
Remember, there’s no one-size-fits-all, so take the time to choose what suits your financial goals.
Need extra cash? Apply for the GXS FlexiLoan and you could receive $488 cashback when you take out a loan of $28,000 or more with a 12-month tenure or longer (terms and conditions apply).
About the author
Audrey Ng is a bargain hunter who tries to sniff out the best deals possible whether it’s food, shopping or travel. She will out auntie the auntiest of aunties.
This post was written in collaboration with ADDX. While we are financially compensated by them, we nonetheless strive to maintain our editorial integrity and review products with the same objective lens. We are committed to providing the best information in order for you to make personal financial decisions with confidence.