If you are an avid shopper and frequently love to shop for new gadgets, clothes, and other items; you may likely have come across ‘no cost EMI offers.’
Lately, they have become hugely popular with consumers across the country because it lets them shop for high-value items without needing to make an upfront payment. But what exactly is a no cost EMI and how do they work?
In this article, we will look at the concept of no cost EMI offers to help you get a better understanding of such schemes so that you can make informed purchase decisions whenever you decide to shop for things like an emi mobile phone or other gadgets, and items.
What is a no cost EMI?
For the average consumer, a no cost EMI means that they don’t have to make any additional spending on interest charges that are typically levied on various consumer durable loans, car loans, etc. But is that true? Even though a no cost EMI may sound like you do not have to pay any interest charges, the fact is that it’s not precisely a no-interest loan. Instead, no cost EMI offers work by giving banks a discount in the form of interest whenever a person takes out a loan. Therefore, it’s not actually a 0% interest scheme.
How Does it Work?
There are two ways that no cost EMI offers work:
- The first option is by letting go of the discount available on the product and instead pay that amount to the loan servicing bank to cover the interest costs
- The other way is to add up the interest rates to the final price of the product and make it appear as a no-interest loan
So, if it is a no cost EMI, then how does it benefit you? Well, here are the top 3 reasons!
Increases Your Purchasing Power
In a consumer-centric market, it’s about which brands are making a kill in sales volume; therefore, almost every brand wants that consumers go a notch above what they want. And this is not always possible if the consumer has a set budget in mind because they have to make a purchase using their money. No cost EMI offers encourage consumers to go in for the latest flagship instead of a mid-range mobile phone because they can opt-in for an EMI mobile phone option, and get a device with higher specification as they won’t need to make a payment from their pocket but instead pay it off over a period that’s spread over months making it easier on the pocket.
No Upfront Cost
One of the other benefits is that these schemes mostly come with no upfront costs involved. This means, you often don’t need to make any upfront payments when buying a new product. This means you get a dual benefit as you neither need to pay any amount at the time of purchase nor do you pay anything above the price of the product in interest charges.
Easy and Simple Process
The process is simple enough for anyone to opt in. A simple KYC document with a basic requirement like ID proof, and address proof is mostly what one needs at the time of applying for a loan. However, you need to have a good credit score to be approved, so keep that in mind.
No cost EMI offers have changed the market in multiple ways. They have helped consumers get the latest products while saving money. So, now that you know what no cost EMI offers mean, and how consumers can benefit from taking out a loan instead of spending their money, we hope that you too will take advantage of such schemes in the future while making a purchase!
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