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A Guide On No Cost EMI On Credit Cards – By Creditmantri

No Cost EMI offers on credit cards are a huge hit with shoppers since they allow you to make big ticket purchases and repay them in easy installments, without any interest! However, not everyone knows what no cost EMIs are and how they benefit customers. In this article, we shall be exploring what no cost EMI offers on credit cards are, how they benefit customers and how you can take advantage of them.

No Cost EMI on credit cards generally means that you can pay off your credit card balance in easy installments without having to pay any interest.

You can find no cost EMI offers on credit cards at various banks and credit card companies. When you find one that offers you no cost EMI on your credit card, you can use it to make purchases and repay the amount in easy installments without having to worry about paying any interest. This means you can use your credit card to make purchases that you couldn’t otherwise afford, without putting a dent in your financial goals.

Not only that, but No Cost EMI on credit cards has many other advantages such as being able to build a good credit score, which can only help you in your future financial decisions.

Short Read: Why convert your credit card purchases into EMIs?

How Does No Cost EMI Work?

This finance scheme works in 2 ways

(a) When the interest amount is applied as a discount on the product

This is the most common way retailers offer no cost EMI. Here, the interest amount is given as a discount on the product you purchase because the bank has to levy an interest rate on the loan you have availed. So they give the interest amount as a discount on the product instead. Let’s try to understand this concept with the help of an example

Let us say you want to purchase an item for Rs.4800. The EMI interest is 12% per annum, and you are choosing a 6 month EMI plan. So the total interest on this loan would be Rs.288 for the 6-month tenure. And your monthly EMI amount would be Rs.848

Under the No Cost EMI plan, this Rs.288 interest burden is given as a discount on your purchase. So your bill amount would become Rs.4800 – Rs.288 = Rs.4512. And the 12% interest rate is applied on the discounted price. So your EMI amount will become Rs.845.12

(b) Where 0% interest is applied directly

Though this is not common, some credit card companies just divide the purchase amount into the number of tenure months and derive the EMI amount. This is a straightforward calculation and prevents a lot of hassle. However, credit card companies don’t do that because an EMI facility is considered a loan and has to comply with RBI regulations. The credit company also has to pay corresponding GST on the loan amount and interest amount and hence use the first calculation.

Interesting Read: How Is Credit Card Interest Calculated

What Is The Process To Get The No Cost EMI Facility?

Users have to understand that this No Cost EMI offer is not available on all products and services. Who is eligible for this facility, and on which products and services it is available, is primarily determined by the credit card company, in partnership with the seller.

You have to first find out what products and services are eligible for this No Cost EMI facility.

The offer details are available on the merchant website, or at store locations. Once you have found the desired product or service, you can add it to the cart, or take them to the billing section.

At the time of payment, you have to choose the 'No Cost EMI' payment option before entering your card details. Because, once you have made payment, this offer cannot be applied.

While applying for this offer, you will be given the available tenure options and the corresponding EMI amount. Choose the one that suits you best and then proceed with the payment.

You will be required to authenticate the transaction with either the card PIN or an OTP. Upon successful authentication, your order is placed, you get your merchandise, and your next credit card bill will reflect the first EMI amount.

What Are The Pros And Cons Of No Cost EMI?


- This is a great facility for those who are not able to pay the entire EMI amount on time. If you are not able to pay the entire EMI amount on time, No Cost EMI can be a great help.

- No Cost EMI is a convenient way to get your credit card usage up without impacting your financial goals. It lets you build a good credit score, which never hurts in your future financial decisions.

- No Cost EMI also helps you build a good credit score because it helps you to build a good repayment history.

- No Cost EMI offers are an easy way to save on your credit card bill. They provide you with a huge discount on your purchase amount, which you can use to buy something else or save it for a rainy day.


- No Cost EMI can lead to huge debt if not used diligently

- Though this is a great facility, it can also be a huge burden if not used diligently. It is vital that you use your No Cost EMI responsibly, so that you can avoid any kind of debt.

- There is a chance that the credit card company may not offer the No Cost EMI facility on all products and services.

- Though No Cost EMI allows you to pay off your credit card in a few simple steps, it is important to note that it carries a higher interest rate as compared to your regular credit card.

- Failing to pay the EMI on time might result in a negative credit score. Losing your credit score not only hampers your ability to borrow money but also limits your access to loans, mortgages, and other financial products.

- Here is an interest read for you - How Do Credit Cards Impact Your Credit Score


No Cost EMI can be an effective financial tool if used with care but must be used wisely. It is a gift that can change lives, and it has the power to transform your financial situation.

Though No Cost EMI offers are a great way to save on your credit card bill, it is important to note that it carries a higher interest rate as compared to your regular credit card. So be diligent and monitor your expenses carefully to stay out of a debt trap.


1. Is there a transaction limit to convert my purchases into No Cost EMIs?

There generally is no maximum amount limit to convert your purchases into No Cost EMIs. But there may be a minimum limit, mostly Rs.2500, to be able to avail the facility.

2. What is the average interest rate on No Cost EMIs?

Though the name indicates ‘No Cost EMI’, there is an interest component in this credit facility, which is in turn offered as a discount on the product. The average interest rate ranges between 12 – 18% per annum.

3. How can I get a No Cost EMI on my mobile phone purchase?

Whether you choose to purchase the mobile phone online or at the store, you need to first determine if the NO Cost EMI offer is available for that particular product. Once you have confirmed that, you need to inform the biller beforehand that you want to use the No Cost EMI offer while making payment. So when you swipe your card, the transaction is automatically converted to a No Cost EMI with your chosen tenure.

4. Can I buy any item from the ecommerce website under the NO Cost EMI facility?

No, this facility is offered only on selected merchandise and brands. If a particular item is available under this offer, it will be notified on the product page and you can buy only such items under No Cost EMI.

5. I purchased a washing machine last week using my credit card. The same item is now available with No Cost EMI. Can I convert this transaction into a No Cost EMI one?

No, the No Cost EMI offer has to be applied at the time of purchase, before you complete the payment. Once you have completed the transaction, you cannot convert it.

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