Buyers enticed by zero-cost EMI options for expensive smartphones need to scrutinise hidden charges, taxes, and discounts, as these can make the instalment route pricier than paying upfront.
A new smartphone that costs Rs 60,000 can make a zero-cost EMI plan look appealing, especially if it lets buyers split the bill into monthly instalments of Rs 10,000 over six months. But the label can be misleading. According to Zee Business, these offers are often built around merchant discounts and bank interest charges that offset each other, rather than a loan that is truly free of cost.
That matters because the final bill can still rise. EasifyMe and Nyvo Money both note that processing fees are common in no-cost EMI deals, and GST may also be applied to the interest element. Even a small charge can push the total above the sticker price, while some buyers also miss out on instant-payment discounts that would have lowered the cost had they paid upfront.
For example, if a retailer offers a Rs 4,000 discount to customers who pay in full on a credit card, the cash price could fall to Rs 56,000. If the zero-cost EMI is based on the original Rs 60,000 price, the instalment route is effectively dearer, even before fees are added. Finnable and Moneycontrol say these extra charges can be enough to make the full-payment option cheaper in many cases.
That does not mean zero-cost EMI is always a bad choice. It can still help households manage cash flow by spreading out a purchase over several months. But consumers should compare the EMI total with the best upfront price, including discounts, processing charges and tax, before deciding whether the convenience is worth the extra cost.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
