Whether you are planning a holiday or need to buy a new phone, a credit card can help boost your spending power. Since these are big-ticket expenses, they may result in a higher bill amount. This is when you may want to convert credit card outstanding to EMIs.
It helps you pay the bill in instalments, but you will still need to pay the Minimum Amount Due, with the remaining balance being converted to EMI. Switching to EMI allows you to convert large bills into manageable monthly instalments easily.
The process is straightforward and can be completed in just a few steps. However, it’s important to know the details before getting started.
Types of EMI Conversion Facilities
You have three options available such as:
- Merchant EMI
Many credit card providers team up with various retailers to offer the advantages of EMI conversion. This enables you to take benefits of offers like ‘No-cost EMI’ when buying merchandise or services. The EMI option for credit cards is available for expenditures like:
- Purchasing electronic devices
- Travel expenses
- Lifestyle purchases
These are readymade EMI options you can avail of and will show on your screen when you make purchases online. You may also get these options as you approach the cashier to pay at physical retail stores.
In most cases, you won’t be charged any interest, but the total amount will be blocked from your credit limit. It is released little by little as you pay each EMI until you repay the entire amount.
- Post-Purchase EMI Conversion
If you are shopping offline or the selected product doesn’t offer an EMI option, you can still take advantage of post-purchase EMIs. There are a few additional steps in this process. While every credit card issuer offers the option to convert credit card payment to EMI, they may use different names for this feature.
You might have come across names such as:
- ICICI Bank’s EMI on Call
- SBI’s Flexipay
- HDFC Bank’s Smart EMI
- OneCard’s EMI Dashboard
You can access this option even if merchant EMIs are unavailable. All you need to do is log in to your online account or mobile app. Click on a transaction to see if it displays the ‘Convert to EMI’ option.
Transactions over ₹2,500 are usually eligible for EMI conversion. Review the associated charges, then click on ‘Convert’ to proceed. This will ensure that you are not suddenly burdened with unforeseen expenses.
- Outstanding Bill To EMI
Your credit card company also gives you the option to pay your entire bill in EMIs. In this case, there is a small fee you need to pay as well as interest charges. These can be high compared to other options but lower than the interest rate applied to unpaid balances. Go in for this option to eliminate financial strain if you have used your card during emergencies.
How to Convert Bills to EMIs
Usually, you can request your credit card provider to convert your total dues to instalments in the following ways:
- Log in to your card account online and search for the option to convert to EMI
- Send an SMS with the right keycode to your bank/provider and you will get a confirmation call from the customer care team
- Call customer service and request for this
- Log in to your mobile app and check if you can click on this option
Remember that getting this facility is not a guarantee. Your request may be approved, but if it is rejected, think of smart ways to repay your bill quickly to avoid high interest.
Why Converting Bills To EMIs is a Good Idea
This facility can be a perk as you can:
- Repay comfortably over a few months based on your chosen tenor
- Save on high interest charges, which would have applied to your unpaid balance
- Maintain your credit score as paying bills in this way is not considered a default unless you miss EMIs
Important Things to Remember
If you are planning to convert credit card outstanding to EMI, consider the following aspects to make better decisions:
- EMI Tenure
In most cases, the EMI tenure typically ranges from 3 to 36 months. You have the flexibility to choose whichever tenure suits your finances the most. However, calculate the total interest you will pay before finalising the tenure as a longer timeline leads to more interest.
- Blocked Credit Limit
When you opt for the EMI option, the amount you owe is temporarily blocked from your credit limit. This block remains in place until you fully repay the amount. This will limit your usage and may increase your credit utilisation ratio. However, you can choose to foreclose your EMI. The blocked amount will immediately become available again for future purchases.
- Timely Payments
It’s important to pay your EMIs by the due date to avoid penalties, which can include late fees and higher interest rates. Failing to do so can negatively impact your creditworthiness.
- Credit Score
Regular EMI payments help you to build a better credit score. Conversely, failing to pay on time can result in penalties and harm your credit rating. A better credit score opens the door to various benefits, including:
- Reduced interest rates
- Increased credit limits
- Simplified credit approval process
To fully enjoy the benefits of your credit card while maintaining healthy finances, you should consider getting a card that makes the EMI conversation process simple. One such card is the One Credit Card.
With it, you can access EMI conversion right on its powerful mobile app. The app makes it easy to check how many EMIs you have paid and how many are pending. You can also foreclose with just a tap.
With this card, you can also earn 5X rewards on your top two spending categories, like groceries, entertainment, or travel, every month. Its app also makes it easy to set spending limits, so you can monitor your purchases and spends. So, whether you have a holiday coming up or festive season expenses, get this card to enjoy savings on electronics, clothing, dining and more. Apply now to experience all these benefits!
