Credit cards are one of the leading ways of making monetary transactions without cash. When using a credit card, you will get credit for any purchase. You will have to provide the cash during the month’s end in case of a credit card. People often look forward to using a credit card as it provides different gifts to the user. Different types of credit cards are available in the market, but the basic mechanism remains the same. Debt clearance is one of the leading things related to the credit card. If a user has excessive outstanding debt in a month, he can repay it to the issuer in EMIs.
It is the responsibility of the credit card holder to check if the credit card issuer provides the opportunity to repay EMIs on debts while you apply for a credit card.
Benefits of Credit Card EMIs every user must know
The leading benefits of EMIs in credit cards are given here in detail. However, you must consider your income and expense pattern before taking the credit card EMIs. Make sure you never default a credit card EMI as it might lead to legal proceedings.
Credit card EMI helps in debt clearance during a monetary crisis
Certain credit cards provide a credit period ranging from 20 to 50 days without any interest. As a credit card user, you need to let your issuer know about your monetary crisis. However, you must fulfill certain criteria for them. In this period, you can make credit purchases without interest. If the interest-free period ends and you still run out of cash, it is the best option to go for is taking the EMI. The tenure of the EMI can range from three months to two years. Thus, it is clear that by incorporating the EMIs, you can get rid of the anxiety regarding repayment.
Credit card EMIs improves the credit score
A credit card user always desires to have an outstanding credit score. With the help of proper money management, balanced expenses, and timely repayment, one can elevate the credit score. In case of hefty debts, you can pay the amount in EMIs. Timely payment of the EMIs can improve the credit score in a decent manner. So, this can be clearly considered as a benefit of EMI payment on credit score. It is always expected to avoid making excessive credit purchases when you are paying the EMIs of the pre-existing debt.
Credit card EMIs lowers interest
Other than the interest-free period, any outstanding debt of the credit card is imposed with a percentage of interest. As a result, the non-payment of debts can develop a huge burden on the credit cardholder. The percentage of the interest lowers as the user opts for the EMI setup. Suppose, the basic interest levied on the outstanding EMI is 3.5% for a credit card, it can decrease to 1% while the user goes for the user.
Ease in credit card usage
By considering to take the EMI format for repayment of all pre-existing debts of a credit card, you can always use the credit card with ease. However, it is a wise step to balance your purchases and repayments all the time.
Loan approval not required
As mentioned earlier, you must always check if the credit card you are using provides the EMI feature. If you find that the above-mentioned feature is present in your card, request the user to transform the debt into EMIs.
There will be a certain date when you will need to pay the EMI. Try not to miss the payment as it might put a drastic negative impact on your creditworthiness.
When using some credit cards, you might also get a chance to transfer the debt balance to another card that has got such a facility.
Offers can act as a savior
In general cases, luxury commodities, electronic products, and other branded products can deliver wonderful discounts. The brands generally tie-up with the credit card issuing company. You must check if you are able to get such discounts. As a result, you can save a lot of money while consolidating the outstanding debt of a credit card.
So, these are some leading ways for how you can enjoy the benefits of credit EMI. On being a creditworthy customer, you can expect to get a good chance to turn your debts to EMI. Try talking to an expert before you take any decisions on turning the debt repayment form to EMI.
However, it is a fact that you will not get a chance to pre-pay the EMI on the outstanding debt. Some card issuers might also charge a fine if you apply for the prepayment of the EMIs. Make sure you transfer the balance to another credit card maintaining the rules. Otherwise, it might put a negative impact on the credit score.