Interested in financial products

Advantages of IndusInd Credit Card EMI Conversion:

Deferred Payment - One might find it difficult to pay their credit card bills in full. They might even want to make expensive purchases. In such instances, they can convert their purchases into EMI and pay them off gradually over the course of the credit period.

Reduced upfront Financial Strain - Since customers pay off the amount over an extended period of time, the financial burden is reduced to a large extent. This is really beneficial for salaried individuals or even others wanting to purchase an item without straining their monthly budgets.

No-cost EMI - This is the best option when one applies for EMI conversion. This option involves providing credit to customers without charging an interest rate or processing fees.

Disadvantages of IndusInd Credit Card EMI conversion:

Interest Accrual - The EMI conversion facility is however not free, as the cardholders are charged interest. The IndusInd Credit Card EMI interest can be around 1.5% (Monthly Reducing Balance) for post-purchase EMIs or 14% for Merchant EMIs.

Blocked Credit Limit - When customers utilize the credit limit the amount is blocked against the total available credit limit. The limit is released only when the amount is actually paid. The unlocked limit is equal to the EMI paid every month.

Increased Credit Utilization - Since a part of the credit limit is blocked, the available credit limit is reduced and thus, customers who continue to use their cards in a similar way will use most of their credit limit. This will lead to an increase in their Credit Utilization Ratio, which reduces their credit score.

Credit Utilization is the ratio between the total credit limit and utilization.

Points to Remember about IndusInd Credit Card EMI conversion

Tenure - Banks generally offer a low-interest rate on EMIs with longer tenures. This makes them look attractive, especially when compared to short loan tenures with higher interest rates. However, this is not true as the cardholder ends up paying more interest with the longer tenure option.

Credit Card - All Credit Cards do not charge the same interest on EMI conversion. At times even cards from the same bank charge different rates of interest. Customers must thus compare interest rates before applying.

Lost Benefits - Another important consideration is that the customer might not earn reward points or discounts for merchant EMI conversion. If the benefits offered are significant then customers should save for the purchase.

Timely Payments - Customers are also required to ensure that they are capable of making timely payments every month to avoid credit card bill overruns. The reasons for the same are:

  • Lost Interest-free period - The interest-free period offered during the EMI payments period is lost if the customer misses a payment.
  • Credit Card Interest rate - IndusInd Bank's credit card interest rate will come into effect when the outstanding amount is not cleared. The interest rate is about 42% p.a. This may lead to an insurmountable interest burden for the customer.
  • Credit Score - Any default or missed payment lowers the credit score.

Ways to opt for IndusInd Credit Card EMI Conversion

There are two ways through which customers can apply for EMI Conversion

Merchant EMI Conversion

This option involves conversion at the Point of Sale. The customer has to request the merchant to convert the purchase into EMI at the time of the payment, in case of retail purchases.

Post-purchase EMI Conversion

In this scenario, customers can log into their net banking account after making a purchase. The various methods are:

How to Convert Purchases into Indus Easy EMI?

You are eligible to convert any transaction above Rs 2000 into Indus Easy EMI within 45 days of making the purchase.

The ways to enroll into the plan include :

Eligibility for EMI conversion through Net Banking

1. Login in to your IndusInd Net Banking Account.

2. Select ‘Service Requests’ from the credit card section

3. Select the ‘Avail Loan/EMI on Credit Card Option’

4. Determine your eligibility for EMI

5. Select a suitable plan for conversion and confirm.

Terms and Conditions for EMI- Pass Facility

The EMI Pass facility is available for select Cardholders.

  • The Bank offers an option to the Cardholders to enroll for an EMI Pass for a one-time enrollment fee.
  • EMI Pass facilitates the conversion of three months’ total purchase outstanding into EMI.
  • The EMI facility will cease to exist after 2 subsequent statement cycles.

The total amount of subsequent outstanding to EMI conversion shall be lower of:

1. Total Outstanding as on Statement date or

2. Purchase Outstanding as on Statement date or

3. Purchase Outstanding as of Conversion date.

Are there any Foreclosure Charges for prepayment

If an EMI is closed after 30 days of the first EMI debit, foreclosure charges of 2-3% will be applied to the outstanding principal amount. However, if you cancel before the first EMI is debited, you will get a waiver on the processing fee and no foreclosure charges will be applied.

Important EMI Calculation Points

Rates of interest

  • The interest increases with an increase in tenure.
  • Interest is charged on all credit card purchases and is the interest on the borrowed amount for the convenience offered.

Processing fee

  • An amount payable to initiate a loan.
  • It is generally 0.5-1% of the total amount of purchase.

Considerations while Applying IndusInd Bank’s EMI Conversion on Credit Card

  • The Conversion option is not available for purchases involving gold, and jewelry and also for cash withdrawals, balance transfers, and card fees.
  • Once the convert to EMI option is availed, any reward points on the card will be reversed.
  • The card holders cannot close their cards during the EMI tenure.
  • Any requests by add-on cardholders will be billed to the primary card holder.
  • Corporate credit cards are ineligible for EMI conversion
  • Foreclosure and cancellation charges are applicable if the user wants to foreclose or cancel the EMI facility before the end of the tenure.

Factors to keep in mind for an optimal choice for EMI Conversion:

Conversion of outstanding credit card bill

This option allows credit card users to convert their entire credit card bills or a part of it into EMIs.

They can repay the unpayable portion of credit card bills in smaller tranches through EMIs

Conversion of select transactions

This option facilitates users to convert beyond a specified predefined threshold amount set by the card issuers into EMI. Exercising this option can be beneficial to users who wish to convert only specified card transactions into EMIs.

Credit Card balance transfer on EMI

Credit Card issuers generally offer the facility of EMI conversion on credit card balance transfers. This allows the user to transfer the outstanding credit balance of a credit card to another credit card issued by a different card issuer and then convert the transferred balance to EMIs.

FAQS of IndusInd Credit Card EMI

1. How can I convert credit cards to EMI?

Credit card bills can be converted to EMI by using the option at the time of purchase transaction of any product. Once the EMI option is chosen the payment that is made at the time of purchase will be charged according to the normal interest rates and the remaining EMI option will be charged at a rate that is higher than the interest rate.

2. Is it advisable to choose the EMI option while paying the credit card bill?

No, it is not advisable to choose the EMI option always as the rate of interest on the EMI option is more and the payment is over and above the credit card bill that is paid by the customer.

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