Should you opt for No-Cost EMI this festive season? Find out

financialexpress.com:

The festive season is a time of joy and celebration, often accompanied by unplanned expenditures due to a deluge of enticing discounts. These discounts can lead to unexpected high spending, which may strain your finances. This festive season is no exception, as brands entice customers with various discounts and convenient repayment options.

To make purchases more affordable, manufacturers often collaborate with lenders to offer No-Cost EMI options, which can be a lifesaver for many consumers. Let’s explore the concept of No-Cost EMI and discuss everything you need to know about it.

No-Cost EMI, also known as zero-interest EMI, is a repayment process that allows you to pay for your purchases in installments without incurring any interest charges. Unlike traditional EMIs, where you need to pay interest over a specific tenure, No-Cost EMI enables you to pay only the product’s actual price in equal installments.

For example, if you purchase a washing machine or a mobile phone worth Rs 24,000 and prefer not to pay the entire amount upfront, you can opt for a No-Cost EMI, which allows you to pay Rs 2,000 per month for 12 months. This way, you save on interest while making your repayment process convenient and stress-free.

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On the surface, No-Cost EMI appears highly attractive as it lets you delay your payment without incurring interest charges. However, there’s a catch that deserves your attention.

Depending on the lender, there may be a nominal processing fee, typically in the range of 2-3 percent of the purchase value, which is paid upfront. Additionally, when availing a No-Cost EMI, you might have to forgo any discounts offered. This means