Planning Diwali shopping on credit card EMI? 5 hidden costs to check before choosing no-cost EMI offers

The festivities of Diwali and Dhanteras are in full swing, with Dhanteras concluding yesterday, i.e., 6 November, as we build towards Diwali tomorrow, on 8 November. In such a euphoric environment, Diwali-related shopping can strain an individual’s budget if payments and expenses are not properly planned and implemented strategically.

This is because, during festivities, products and services such as new clothes, gifts, crackers, and similar items are usually purchased through prominent e-commerce platforms, and payments are made digitally. During such payments, clearing the full payment can sometimes be quite challenging.

To deal with such situations, credit card EMIs may come in handy by allowing cardholders to plan and spread large purchases over several months. Still, what aspiring borrowers and credit card holders should not ignore is the fact that a ‘no-cost EMI’ offer, as the name suggests, does not necessarily mean or signal that you pay nothing extra.

Processing charges, other associated expenses, GST, and the loss of upfront discounts can eventually increase the actual cost of your purchase.

That is why, before recklessly converting your festive shopping bills into EMIs, you should diligently check the 5 costs discussed below.

Plan your festive purchases before swiping

Therefore, a ‘no-cost EMI’ offer makes sense only when the total amount payable is genuinely competitive with the upfront payment option and adds value to your life in a constructive way.

Make sure that you carefully consider and compare the final purchase price, processing charges, applicable taxes (if any) and any other hidden expenses, along with any lost discounts, before proceeding with the repayment tenure.

Furthermore, it is essential that you keep your overall debt levels in check. Do not convert every purchase you make during the festive season into EMI. Add up your existing instalments and essential monthly expenses to decide how much you can comfortably manage and repay.

What should not be ignored is the fact that a smaller monthly EMI does not automatically mean a cheaper purchase. The best Diwali deal is the one that you actually need and fits your budget without leaving you with a difficult-to-manage, expensive repayment burden after the festivities are over.