Unmasking 'No-Cost EMI': Why Zero-Interest Deals Aren't Truly Free
Business
M
Moneycontrol•08-01-2026, 16:02
Unmasking 'No-Cost EMI': Why Zero-Interest Deals Aren't Truly Free
- •The 'no-cost EMI' label is often a marketing tactic, as banks still charge interest on these loans.
- •Sellers or platforms offer discounts to offset the interest, making the total payment appear equal to the original price.
- •Consumers may miss out on lower upfront prices or other discounts available for full payments, making EMI more expensive.
- •Processing fees, conversion charges, and GST on the interest component add to the actual cost, which are not covered by the 'no-cost' promise.
- •Early cancellation or prepayment can incur additional fees, and merchant discounts may be reversed, leading to unexpected costs.
Why It Matters: Always calculate the total cost of 'no-cost EMI' including fees and lost discounts; it's rarely truly free.
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