ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Credit cards and signature loans are unsecured loans. This means they are not backed by any collateral. Unsecured loans usually have higher interest rates than secured loans because the risk of default is higher than secured loans.

Detailed explanation-2: -Common types of unsecured loans Revolving loans: These are loans that the borrower can use and repay repeatedly. Credit cards and personal lines of credit are examples of this type.

Detailed explanation-3: -Credit cards and personal loans are examples of unsecured loans.

Detailed explanation-4: -Unsecured loans are loans that don’t require collateral. They’re also referred to as signature loans because a signature is all that’s needed if you meet the lender’s borrowing requirements.

Detailed explanation-5: -The range of the interest rate on any unsecured loan is between 10.99% to 32%. The borrowers can get the best interest rate based on their credit profile, income, employment and age.