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No cost EMI vs EMI Explained

When you borrow money, it is usually paid back with an interest on the principal. The total amount, i.e. the principal plus the interest is broken up into a number of equal amounts called equated monthly instalments of EMIs. These EMIs are to be paid back over a period of time, thereby reducing the burden on the borrower. Rather than having to pay back a large sum upfront, the borrower can now pay back in small instalments that are more affordable. However, in some cases, depending on your credit history and your lender, you may not be charged any interest on the money you borrowed. This means that you pay back only the principal amount that you borrowed in monthly instalments. This is known as a no cost EMI.

How Does a No cost EMI Work?

Suppose you wish to purchase a mobile phone that costs Rs. 48,000 but don’t have enough funds available. Depending on your credit history, your lender may offer you the option of no-cost EMI. This means you would be advanced a loan which needs to be paid back in, say, 3 instalments of Rs. 16,000 each. In a regular EMI, your outgo would be more as the interest rate gets factored in. Assuming the interest rate to be 15%, your EMI would be Rs. 18,400. On top of this, there would also be processing charges on the loan. Thus with a no cost EMI you avoid paying extra charges on top of the EMI that you are paying. Additionally opting for a no cost EMI may even improve your CIBIL score that improves your creditworthiness, making you eligible for a number of offers and discounts leading to additional savings.

How to Avail of No cost EMI While Shopping?

The no cost EMI option is usually available only on select products, and it can be availed only by using debit or credit cards that offer this feature. Bajaj Finserv EMI Network card is a card that offers the option of availing no cost EMIs at over 84,200 stores spread over 1300 cities making it one of the most widely accepted no cost EMI cards. Bajaj Finserv EMI card is also accepted on all major e-commerce platforms such as Amazon, Flipkart, Pepperfry, GoIbibo, etc. You can use the Bajaj EMI Card apply online process by logging on to the Finserv MARKETS website.


In a no cost EMI, the credit extended to you is divided into smaller, easily payable amounts without any additional charges on top of what you’re already paying. In a regular EMI, the interest rate charged by the lender is added to the principal amount to arrive at the EMI. Additionally, there might be processing charges involved. Thus a no cost EMI leads to major savings. You can avail of no cost EMIs through your Bajaj Finserv EMI card that is accepted at a large number of stores both online and offline.