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Pros Of Emi In Advance
1. Lower Interest Rates
One of the most significant advantages of opting for EMI in advance is that it comes with lower interest rates. Since you pay a portion of the total cost upfront, lenders have less risk involved in lending to you. As a result, they can offer you a lower interest rate compared to regular EMI schemes. This can translate into more significant savings for you, especially if you opt for a long-term EMI plan.
2. Better Affordability
EMI in advance allows you to purchase expensive items that you might not be able to afford if you had to pay the entire amount upfront. By dividing the total cost of the item into smaller, more manageable monthly payments, you can make the purchase without putting a significant dent in your finances. This means that you can own the item you have been eyeing without placing an undue burden on your budget.
3. Easy Repayment
Since EMI in advance is designed to be paid in installments, you don't have to worry about repaying the entire amount at once. This gives you more time to manage your finances and ensures that you can stick to your budget without straining your finances. Furthermore, many lenders offer EMI plans with flexible repayment terms, so you can select a plan that suits your financial situation.
4. No Need for a Credit Card
Most EMI in advance plans don't require a credit card, making them more accessible to customers who don't have a credit card or don't want to use their credit card for large purchases. This ensures that anyone can purchase expensive items without worrying about eligibility requirements or creditworthiness.
Cons of EMI in Advance
1. Higher Total Cost
One of the biggest disadvantages of EMI in advance is that it comes with a higher total cost. This is because you have to pay interest on the full amount of the item, even though you are making a portion of the payment upfront. This can add up to a significant amount over time, especially if you opt for a long-term EMI plan. Therefore, it's essential to calculate the total cost of ownership before opting for EMI in advance.
2. Pre-payment Charges
Some lenders may charge pre-payment penalties if you decide to pay off your EMI in advance plan before the end of the contract period. This can be discouraging for customers who want to save money on interest charges by repaying the loan early. Therefore, it's crucial to read the terms and conditions of the EMI plan before signing up for it.
3. Not Always Available on all Products
EMI in advance plans are not available on all products offered by retailers. Some retailers only offer this payment option on select items, which may limit your purchasing options. Therefore, it's advisable to check with the retailer before making a purchase to ensure that EMI in advance is an option.
4. No Cost EMI Offer
Some retailers offer a No Cost EMI offer, which allows customers to pay the full amount in installment payments without any interest charges. However, this option is not always available on all products and retailers. For example, Croma No Cost EMI may only be available on select products at certain times. Therefore, it is essential to read the terms and conditions of the offer before making a purchase.
Final Thoughts
EMI in advance can be a useful option for customers who want to make expensive purchases without putting a significant dent in their finances. However, it's essential to weigh the pros and cons before opting for this payment option. The lower interest rates, better affordability, easy repayment, and no need for a credit card are some of the benefits of EMI in advance. However, the higher total cost, pre-payment charges, limited availability, and the unavailability of No Cost EMI offer on all products are some of the drawbacks. Therefore, customers must do their research and read the terms and conditions of the EMI plan and No-Cost EMI offer before making a purchase.
One easy way of availing No Cost EMI on your high-ticket purchases is the Bajaj Finserv Insta EMI Card. The Insta EMI Card lets you convert your high-price purchases into manageable monthly instalments while offering Zero Down Payment offers.