The simple answer is – no. Your credit card spends are essentially debts that you take on for a short term that you pay off when you pay your credit card bill, at the end of every billing cycle. A loan, by definition, is a debt that you are taking on for a specified purpose – buying a two wheeler or a car, buying a house that is either constructed or under construction, personal loan for personal expenses, etc.,

Most people are aware that the interest and charges on credit cards are among the highest in the market. As opposed to this, the interest on most loans is regulated and much lower. Even in case of personal loans where the interest rate is among the highest in the market, the interest is lower than credit cards.

It might seem like a good idea to pay your loan EMIs using your credit card since your spends accrue reward points but maxing out your credit limit regularly is not a good idea. Sooner or later, it is likely to catch up with you as you are unable to make the payment for your credit card bill on time. This is a well-documented trap that many people fall into.

Another reason to not use your credit card for loan EMI payments is that it is discouraged by most banks or financial institutions that disburse loans. It is always preferred that your EMIs be electronically cleared directly from your savings account & banks often insist on this. There is seldom an option to pay your loan EMI using your credit card every month.

Using your credit card to pay off these EMIs may seem like the optimum use of your credit instruments but it is a slippery slope to more debt. Taking on more debt to pay an already existing debt can never be a good idea.