Credit card bill repayment can be done in easy EMIs to prevent negatively affecting your financial health in the future.
Trupti, 28, had not been checking her credit card bill for some time and was irregular with her payments due to low funds. It was only when she reached out to the bank for a loan to fund her new house, did she get to know that she had a massive bill to pay due to late credit card payments.
While it is true that credit cards offer instant access to funds to finance your transactions, what most people miss out on is that the repayment part is equally important. If you pay the borrowed amount after the due date, high-interest rates and fees will be levied on the outstanding balance. This would increase your credit card debt and impair your finances and credit score, significantly. To do away with this risk, you could consider converting your transactions into EMI so that you can enjoy a longer repayment time. Here are the ways in which you can do so-
Ways to Avail Credit Card EMI
- Repay at lower interest costs
Not paying bill credit card payments on time, i.e. within the due date, attracts massive finance charges. These charges coupled with the late payment charges on the bill amount can increase your outstanding balance significantly. The interest-free period on new transactions is also revoked until the full bill is repaid. To prevent falling into a debt trap in such a situation, you could convert a part of your credit card bill or the entire amount into EMI which has a much lower interest rate.
- Pay bills without compromising on liquidity
The credit card EMI repayment tenure can range anywhere between 3 to 60 months, depending on your bank and the EMI type chosen. You can select the preferred duration for credit card EMI payment based on your repayment capacity. This allows you to purchase items using your credit card and converting each purchase individually, or the total bill, into EMIs, without compromising on liquidity.
- Avail EMI offers at merchant stores online and offline
Several online and offline merchant stores have tie-ups with credit card issuers and offer the option of converting credit card purchases into EMI. The tenures and interest rates offered against such EMIs are in some cases better than regular EMIs. All you need to do is opt for the EMI offer on your credit card before completing the purchase.
- No Cost EMI option
In some cases, no-cost EMI as an option can also be availed against merchant EMI. If you opt for this advantage, your credit card doubles as a no cost EMI card and the interest aspect of EMI is passed to and borne by the merchant. As a result, all you are required to pay is the purchase cost of the item and the GST levied on interest. The no cost EMI feature may also come bundled up with special discounts, cashback offers, and other attractive deals which might allow you to save more. Financial apps such as the Finserv MARKETS app, provide a detailed picture of all such benefits you can avail against popular credit cards.
- Instant funds to cater to emergencies
If you have a good credit history, you can easily get a loan against your credit cards. These loans are different from regular loans as they are sanctioned against the credit limit on your card. As a result, they are pre-approved loans and do not require you to submit applications or get approvals from the bank. This makes them extremely useful in case of emergencies, as the processing and disbursal time is shorter. The credit limit on the card is readjusted in proportion to the amount loaned on the card. The same is reinstated when you repay the loan amount in full. You can pay the amount in the form of smaller EMIs based on the tenure, which may vary from bank to bank. The finance charges too are relative and are dependent on the bank and your credit profile.
Credit cards these days, from some of the popular banks in the country, may offer one or more of these EMI options to make purchases affordable. Therefore, it is wise to check the features of each credit card before selecting the one that best suits your portfolio. You can refer to credit card apps, such as the Finserv MARKETS app to get a detailed understanding of the benefits before you apply for a credit card. If you already have a credit card, you can explore the various credit card EMI options so that you can get the best out of your credit card without affecting your long-term financial health.