Shopping Lessons about No Cost EMI !!
No its actually NOT a NO COST EMI…
Have you ever found yourself eyeing the latest range of smartphones and wishing you could replace your old, outdated mobile with a trendier one?
We’ve all been there – scrolling for hours, looking at the new features and watching unboxing videos, only to realize the price is too high for us to pay. And it’s not just phones – it’s the same with a variety of products and services.
With the high prices of many of these products, not everyone can afford to pay out of pocket at one go.Many brands these days have added a variety of payment options for your convenience. Of these, Equated Monthly Instalment (EMI) plans have taken India’s e-commerce economy by storm, with a lot more people availing the payment plan being offered. But do these No cost EMI actually help? Let us understand with an example –
How Does No Cost EMI Work?
(a)When the discount equals interest:
Cost of the product = Rs.80,000/-
Discount = Rs.4,500/-
If you pay for the product upfront, you get the discount of Rs.4500, this means you get the product at a discounted price of Rs. 75,500/. If you choose to buy the product with a no cost EMI scheme, you have to pay the full price of Rs.80,000, which is divided into EMIs.
(b)When the interest amount is added to the cost of the product:
Let’s say you want to buy a product that costs Rs.15,000/. In a no cost EMI scheme, you get this product at Rs.17,250/. In this case, the interest (15%) amount of Rs.2,250 is added to the product price that is payable in EMIs spread across a specific tenure. Sometimes, the interest component is covered as processing fees.
No cost EMIs' is a misnomer because the interest is actually built into the EMI except that the break up may not be clearly visible to the buyer upfront.
While buying a product on EMI takes away the burden of paying the huge cost upfront but there is always a cost that one has to bear on these 'no-cost EMI' schemes.
There are also advantages of no cost EMI like this scheme is best during festive season, where you need to shop in bulk while keeping your budget intact. Also, all your needs become affordable, avail it on different platforms, easily available online.
Whoever said that money can't buy happiness simply didn't know where to go shopping!!!....