An equated monthly instalment (EMI) is a way to pay off a loan in parts over time instead of making a single lump sum repayment. factors such as the principal amount, loan tenure, and the interest rates determine the amount you pay as your loan EMI.
As with most financial schemes, EMIs have both benefits and drawbacks. here are some factors to consider before making an informed choice.
Being able to buy big money items on EMI is probably one of the biggest factors that draws people towards credit cards. By availing the credit card EMI facility, you can buy those out-of-reach products that would not be possible for you otherwise.
But there is some more good news for you. There are quite a few options available in the market that allows you to buy high-priced products on EMI without a credit card. These options include both online and offline modes that you can use and pay for your purchases in conveniently manageable monthly instalments.
The most popular Non-credit card EMI options available in the market today have been listed below
- Debit card
- Amazon Pay EMI
- Through Post Dated Cheques
There are a variety of Non-Credit Card EMI options including:
- Debit card
Today, almost every major bank offers the facility of EMI through their debit cards. You can use your debit card to make online purchases on EMI or you can also go for offline store purchases. The conversion would be done without any amount being blocked in your account.
- Amazon Pay EMI
Online retailer Amazon has also introduced the EMI facility that can be availed without a credit card. A select set of customers can avail the credit in a seamless way and it doesn’t involve any processing, cancellation, or pre-closure fee.
- Through Post Dated Cheques
Select offline stores provide the option of EMI through post-dated cheques to their customers. To avail this, customers have to submit their post-dated signed cheques along with some additional documents to purchase their desired products on EMI.
How to apply for the various Non-credit card EMI options?
- Debit Card
You do not have to apply for the debit card EMI if you already have a debit card issued by a bank that offers debit card EMI options. Just check out if that facility is provided by your bank.
- Amazon Pay EMI
At present, this facility is offered only to select Amazon customers and therefore, all you need to do is check if you are eligible for the EMI offer and complete a one-time setup for the Amazon Pay EMI facility (if you are eligible). Also, note that this facility can be availed only through a mobile device and the minimum purchase value should be Rs.3,000.
- Through Post Dated Cheques
For using post-dated cheques, you need to have a bank account and a sufficient number of cheques to submit it to the retailer.
Advantages of EMI
1.Freedom to buy: an EMI option allows you to buy expensive items right off the shelf, even though you might not have the funds to pay for it at that very moment. for instance, if you’re a salaried person, buying your dream home or car is easier with an EMI option with your loan, as compared to a lump sum repayment.
2.Affordability: be it expensive household items, a vehicle, gifts or even a house, EMIs can help you buy anything and everything. your lender divides the total amount in monthly instalments, and you pay it off in manageable chunks.
3.Easy on the wallet: since the monthly payment is already known and distributed over the loan tenure, the EMI option will not burn a hole in your pocket, therefore allowing you to make other investments and spend elsewhere too.
4.Plan payments with EMI calculators: EMI calculators available online will allow you to calculate your monthly outflow depending on the principal amount, interest rate charged, and time horizon. planning for other expenses and investments out of your income can be done easily.
5.everage flexible EMI options: several banks and financial institutions now offer flexible EMI schemes. here, the lender allows you to decide on the amount per EMI or the payment duration, depending on your financial standing and income.
6.no mediators:the EMI is directly paid to the lender, and there is no involvement of multiple parties handling your payments.
