EMI on Credit Cards: What is it, and how does it work?

Want to make big purchases but struggling to manage expenses? EMI on credit cards can help you! With EMI, you can split up your payments into smaller monthly instalments. This means you can enjoy the things you want without worrying about going over budget and with better financial flexibility. 

Let us understand EMI on credit cards in detail.

How does EMI on credit cards work?
 

EMI on credit cards works in two ways:

• Convert outstanding dues into EMIs:
  
  

  It allows you to convert your outstanding credit card dues into smaller instalments and pay them over time. Instead of making the entire payment in one go, you can pay it in tranches, i.e. part by part.

• Split specific purchases into EMI:
  
  

  You can also shop for big-ticket items and pay for them using the EMI facility. Below is an example of the same how FIRST SWYP Credit Card customers can opt to pay in EMIs while making a purchase. 

Benefits of EMI on credit cards
 

EMI on credit cards offers several benefits. Some of them are as follows:

• Highly affordable

EMI on credit cards converts large payments into monthly instalments, making it affordable and easy to manage. This will help you settle your dues while maintaining financial stability.

• Convenience

With easy budgeting and monthly payments, EMI on credit cards make big purchases convenient and manageable, ensuring you get to fulfil every dream.

• Intact credit score

EMI on credit cards reduces default risks, like missed or delayed payments, and impacts your credit score positively. Timely repayments contribute to long-term financial health.

Things to consider while opting for EMI option on credit cards
 

There are certain things to consider while availing of this option. These include -

• Applicable interest rate

While interest rates vary across banks, certain factors influence them. These include:

The amount you want to convert into EMIs - The higher the amount, the greater the chances you will need to pay a higher interest rate.

Payment history - If you have settled your outstanding credit card dues on time, you will likely be offered a lower interest rate. In case you've missed payments in the past, interest on EMI on credit cards is likely to be higher.

Pro-tip - Opt for a credit card like the FIRST SWYP Credit Card that eliminates interest rate complexities. Just pay a flat monthly EMI conversion fee and nothing else. This offers a unique advantage to cardholders, helping them save money on high interest charges, convenience and fees.

• Simplified EMI payments

EMI on credit cards allows you to convert high-value purchases, such as buying a new phone or going on a vacation, into easily manageable monthly payments. This is a hassle-free way to get what you want without worrying about the burden of a large payment. The FIRST SWYP Credit Card offers a flat monthly EMI fee of starting from Rs 49 + GST, allowing you to spread the cost of your purchases over time.

• Processing fees

Banks generally charge a processing fee when you convert your credit card dues to EMIs. The processing fee varies depending on the bank and is added to the total cost of availing the facility. With the FIRST SWYP Credit Card, you don't have to worry about it, as it doesn't charge any processing fees.

• Repayment tenure

Repayment tenure is when the bank allows you to pay back the EMIs. This differs across banks and can range from a few months to even a few years. Opt for a tenure that allows easy repayment.

Pro-tip - Merchant offers you can't miss
 

Merchants offer EMI on credit cards, making the purchase convenient and financially rewarding. With the FIRST SWYP Credit Card, you can enjoy irresistible deals from top merchants like Domino's Pizza, TATA Cliq, EaseMyTrip, Zomato, and more.

How does EMI work on the FIRST SWYP Credit Card?
 

There are two types of credit card EMI conversion facilities available on FIRST SWYP Credit Card - 

• For transactional EMI -

   Convert large purchases into EMIs to pay over time instead of upfront. This helps manage finances and make big purchases more affordable.

• For bill payments –

   You can also choose to pay your outstanding bill in EMIs. There is no concept of revolving credit with this card. That means, you can either pay your bill in full or convert it into EMI, for a flat monthly EMI conversion fee.

To put it simply, this card minimises the risk of falling into a debt trap due to high interest rates and penalties stemming from carrying over credit card balances for months and even years.

In conclusion
 

The EMI facility on the FIRST SWYP Credit Card offers peace of mind, allowing you to pay outstanding dues on time and manage essential financial commitments without straining your finances. With transparent, flat monthly EMI conversion fees, and convenient tenures, the FIRST SWYP Credit Card makes credit card payments hassle-free for users. Apply for one today!

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.