What is No Cost EMI? If you do online shopping, then while shopping online you must have seen the word “No Cost EMI” appears written in the product description. So after all, what is this thing? What does it mean? And how it is different from simple EMI, how does it benefit the customer, company, and bank, today we are going to tell you about this, so let’s know.
Nowadays almost all companies give the option of no-cost EMI on some of their products. Both Flipkart and Amazon are the most popular companies in terms of online shopping in our country. You must have seen in most of the sales that these online shopping companies also offer No Cost EMI on some of their special items, in such a situation some customers often get confused by seeing EMI and No Cost EMI.
But for your information, let us tell you that the only difference between them is interest and processing fee, which you can understand further. Read below to know what exactly is this EMI strategy, how does it work, and what are benefits while shopping online.
What is No Cost EMI?
No Cost EMI is No Cost Every Month Installment. When you buy a product under simple EMI, you have to pay a processing fee and an interest amount which gets added to the amount every month. Whereas in the No Cost installment, you have to pay only the cost of the product. In this, no amount is added except EMI. Hence it is called No Cost Every Month Installment.
First of all, let’s talk about what is the meaning of this no-cost EMI, then see what happens if you buy any item from EMI then you must have a credit card. All the online shopping companies that offer No Cost EMI have joined hands with some banks, for this, if you have credit cards from some selected banks like HDFC Bank and Axis Bank, then you get the highest offer on them. At present, Flipkart and Amazon are quite popular in our country, both of these websites get the highest No Cost EMI offers.
How Does No Cost EMI Work?
Suppose if the rate of an item is Rs 12000 and the company is offering No Cost EMI on this product, then you can pay Rs 12000 in three or four installments. If you are paying in three installments, then you have to pay 4000 rupees a month and if you want to pay in four installments, then the amount you have to pay will be 3000 rupees a month.
When it comes to simple EMI, you also have to pay some interest in every month’s installment. If there is a product of 12000 thousand rupees, then in ordinary EMI this product falls from 13 to 14 thousand. Interest is also included in this. But when it comes to No Cost EMI, then you do not need to pay any interest here. If your product is of 12 thousand rupees, then you have to pay only 12000 rupees in separate installments. For this, you do not need to pay any separate interest in any way.
Benefits of No Cost EMI
In this process, the first benefit is to the customer because with this the customer does not have to pay Rs 12000 together, he can buy goods worth Rs 12000 in different installments, apart from this the interest on EMI also does not have to be paid.
Now you would like to know that what is the benefit of this to the online shopping site? Then let us tell you that this company offers No Cost EMI on those products which sell less or whose demand is less. By paying the No Cost installment strategy, the company’s low selling products also start selling more due to the No Cost Every Month Installment payment.
This also benefits the bank because their credit card is used in this and we all know that the bank also deducts some percentage of charge for shopping with a credit card or debit card.
That was all about No Cost EMI, its benefits, and how does it work in real life. You must know that the majority of sites and stores ask for a credit card to get a no-cost installment. So, if you don’t have a credit card yet, get one immediately and get the best offers on purchase. I hope you like this post. Keep visiting Janta Yojana for more informative posts.