Can I Convert an Outstanding Amount of Credit Card into EMI?

Updated on: 14 Dec 2021 // 23 min read // Credit Cards
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A first-time buyer of a Credit Card will have several doubts and questions in their mind. Questions like – What if I lose my card, what if I could not repay the whole amount in due time, what will happen if I need to exceed my credit limit, is there any penalty or charge and so on. It is a common phenomenon and applies to everyone. When you start using the service, gradually all the “ifs” and “buts” will vanish. When you are purchasing something, using a debit card, you know that the amount will be deducted from your savings account; but when you are using a Credit Card, you are indirectly taking a loan from the bank which you will pay at the end of the month. The Credit Card companies always try to help you understand all the available features of your card, but you should also inquire about things you do not understand or things which are new to you. A lesser-known feature of Credit cards is – converting your outstanding amount into an Equated Monthly Instalment (EMI).

The Top Credit Card Companies in India will always send you a monthly statement of your expenses, both through e-mail and the address you registered with the company. You should analyse this statement carefully and keep track of your expenses to check if the expenditures made are the same as the mentioned ones or not. This precaution would not only safeguard you from any fraud transaction but will also give you a fair idea of what on an average is your monthly usage and repayment amount. In the monthly statement, you will see options for paying the whole amount or a partial amount at the end of the month. There might also be an option available to convert the amount into an EMI. If you wish to convert your outstanding amount into an EMI, you should initiate this service as soon as you make a transaction, as there are companies which turn the amount into instalments only till a fixed date.

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So, what can you do if you did not know about it earlier? How can you divide the amount into EMI and avail its benefits? As a customer, you should know that you can convert the whole amount you spent on your Credit card into an EMI as well as a specific transaction that you find to be high enough to influence your monthly budget. Not all the cardholders get this option of converting the whole outstanding bill into an EMI. Such a facility is available at selected banks and applicable for specified schemes. To check if you could avail this conversion, you can either use internet banking option or check your card’s eligibility directly with your service provider. If you are eligible for such a change, you can convert your outstanding amount into an EMI with just a message. Phone banking or internet banking is of great help in such a situation.

If you wish to avail the second option, check with the retail store from where you are shopping. They may or may not allow such a practice of converting an outstanding amount into an EMI for the purchase made with your Credit Card. Most of the big brands do have this facility at their stores since electronics or furniture; on every prominent purchase; people do seek some financial help. This option is particularly prevalent amongst people who like changing or upgrading their mobile phones very frequently since you only need to pay one small amount at the time of purchase while the rest can be paid in small instalments for a year or so. Though, you have options available for taking credit for such goods from various finance companies, having a Credit Card is an add-on for the deal. You may get benefits that you didn’t even imagine – like a goodie bag or a top-up on warranty period, that too free of cost.  Another reason why people choose this option is that you do not have to pay a considerable amount as a penalty if, for any reason, you fail to make the complete payment. For big-ticket expenses, the deal is quite luring. Individuals, who are thinking of converting their outstanding dues into EMIs, must know that the payment of the whole amount is entirely interest-free if you clear your dues every month. If you pay a minimum amount as mentioned in your Credit Card statement or if you pay off a partial amount, interest is chargeable on a periodic basis. While for converting the whole outstanding amount into an EMI, the interest is to be charged just like in a loan from a bank.

Make sure you know about these basics before you levy the option of an EMI. You would also need to ask your service provider if they facilitate this option or not. Not all the Credit Card providers allow you to convert your dues into a loan, and even if they do, it could be available only for select schemes and for a fixed upper limit as well as a lower one. Also, if you are eligible for such a conversion, all the purchases cannot be converted into EMI. Do evaluate your EMI on the grounds of – the rate of interest, the tenure of repayment, processing fees or other taxes. Certain service providers also have Zero Cost conversion facility for transferring the amount into a loan. While in cases, this change can take away the discounts or rewards offered by your Credit Card. A thorough analysis is mandatory for performing such a transformation. Research is important before choosing one of the Top Credit Cards in India. Credit Cards are highly valuable, but the best way to use them is to stay away from ‘balance.’ EMI, however, remains a good option for big-ticket purchases.

Also Read:  8 Reasons to Say Thank You to Your Credit Card Company

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