What is no-cost EMI? How to take advantage of it in the festive season
Credit cards have now become the first choice of most people for payment. There are many reasons for this. First of all, the use of credit card is very convenient. Reward points are also available on this. Also, attractive offers are available on purchases with credit card during the festive season.
Credit card is a profitable deal for all three i.e. buyer, shopping platform and bank. Buyers get a good deal. Sales of companies increase. At the same time, the transaction of the bank or financial institution issuing the credit card also increases. But, some things must be kept in mind while using the credit card.
How to use a credit card
The first priority while using a credit card should be to always pay the bill on time. This will save you from paying huge interest and late penalty. Also, if you want to buy a fridge or washing machine and are not in a position to pay the money in one go, then you should use no-cost EMI.
What is no-cost EMI?
No-cost EMI gives you the facility to pay money on EMI without interest. However, interest is usually included in the price offered by the brand. For example, you are buying a washing machine worth Rs 30,000 on no-cost EMI. In this, it is possible that the retailer has already included the interest amount in the offer given to you. But, interest will still be applicable, which will lead to a slight increase in your monthly installments.
On which products no-cost EMI is available?
Finance companies mostly offer no-cost EMI facility on expensive items like electronics, furniture and gadgets. In this, you get the convenience of paying your payment in 6-9 months. With this, you can buy your favorite things in the festive season without going out of your budget. This no-cost on credit card is an easy way for consumers to divide big expenses into small installments without interest. Partner merchants provide this option.
Use no-cost EMI responsibly
You should use no-cost EMI responsibly. You should avoid buying unnecessary things in the greed of no-cost EMI. It should always be kept in mind that the money spent from the credit card is also a loan, which you have to repay on time. Otherwise, your credit score may be spoiled and in future you may face problems in taking loan from any financial institution.
Manage credit card like this
- Understand the terms and conditions well to avail the facility of no-cost EMI.
- Also check the extra or hidden cost included in the price of the product.
- Shopping should be done only if the EMI fits in your monthly budget.
- Your total EMIs should never exceed 40% of your in-hand income.
- If your credit card dues increase, use your savings to pay them off.
