Most e-commerce websites allow you to buy expensive gadgets, including smartphones, and consumer durables on EMIs. Banks such as SBI, ICICI Bank Ltd, HDFC Bank Ltd and Axis Bank Ltd give the option of EMI for smartphones, electronic and household goods.

The EMIs are for a period of three to 36 months. It is available on debit and credit cards. The interest rate is in the range of 12% to 18% an annum. You can opt for EMIs only for items sold by a single seller and if the minimum order is Rs3,000.

The cost

For example, consider buying an Apple iPhone X (Space Gray, 64 GB) from Flipkart, which is priced at 85,999. For an EMI plan using a State Bank India card, the interest is 14% an annum. For a six-month plan, you will have to pay 14,925 a month for six months. The total cost will come to 89,550, which means you will pay 3,551 more towards interest. The bank will charge interest on the reducing monthly balance.

Should you go for EMI?

It is advisable not to buy consumer durables on EMI, as the interest rate is higher. It is better to save first and then buy. In most cases, the cost of electronic items, especially phones, decline over a period of time. If you can’t afford it, it is better not to buy it. However, if you still want to get an item on EMI, shop around for better rates. Look for the lowest interest rate and opt for low tenures as it would make the interest rate even lower. In case you have opted for the EMI option, don’t default on repayment, as it will have a negative impact on your credit score.

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