What is the difference between a loan and a credit card?

A credit card is a form of loan provided by its provider to its clients. When using it, you actually have the bank’s money and you create a loan that you subsequently repay to the card issuer (provider).

How much you have to pay back


Each client is initially given a credit limit to which they can draw from the credit card. Every month you will receive a statement from the provider, where you will know how much you have drawn and how much you have to pay back at least.

If you pay the entire amount in the interest-free period, you do not have to pay anything extra. In the case of a minimum repayment you then pay interest on the unpaid part.

Pay with a credit card

You can pay with a credit card in a shop, on the internet and you can also withdraw cash from an ATM. However, it is designed primarily for cashless transactions, as withdrawals from ATMs are usually very expensive.


  • accompanying discounts and promotions at various retailers
  • it can also be used outside the Czech Republic (but it is advantageous only for cashless payments)
  • is always available
  • interest-free period (up to about 40 or 50 days)
  • possibility of re-drawing


  • high default interest on time
  • the ability to draw constantly encourages headless spending
  • fees – for card, for credit account maintenance, for withdrawal from ATM, etc.
  • longer processing time at the beginning and usually the need to visit the branch in person

A short-term loan is a product that offers a large number of primarily non-banking companies.


Here you draw a lump sum in advance and are familiar with the amount of the final installment, interest and any other fees. You can arrange a short-term loan either at a branch, via the Internet or in other ways.

It can take up to several minutes. However, it is always necessary to carefully choose the company with which you borrow the loan, as there are large differences in conditions and some companies may be fraudulent.

So always follow client references and check the address and conditions on the company website. Many companies also offer a loan calculator on their website where you can calculate everything yourself. One of these can be found on our website.


  • fast processing
  • the possibility of handling the house
  • Some companies like Harlequin offer their first free loan
  • you will borrow exactly the amount you need at any given time


  • high interest on default
  • possibility to draw only once, otherwise you have to apply again

As you can see, each product is suitable for different purposes and it is up to you which one you need and which one you choose. But never forget that before you borrow money, you must be sure in both cases that you are able to repay it.