Shopping via credit cards is convenient as it allows an individual to shop for items on credit. However, this convenience comes at a price. Even though most credit cards offer up to a month of interest-free period, if a customer fails to pay within that timeframe, the interest rates could start piling up.
Since credit cards work on the principle of compounding interest rates, it could turn a person into what they refer to as a ‘revolver’ meaning that they may end up paying 2-3 times the money and still may not be able to settle the principal amount.
The best way to avoid this scenario is to convert all those purchases into EMIs to avoid falling into a debt trap.
How to Convert Credit Card Outstanding into EMIs?
The simplest way to do so is to call customer care once you have purchased a high-value item and put in a request to convert that purchase into an EMI option using a credit card EMI calculator to help you understand the monthly charge you would need to pay for the duration of the scheme.
This will also help you manage your finances better and ensure that you are able to pay off the amount without putting a strain on your finances, and also frees you from the risk of falling into a credit card debt trap which can sometimes turn out to be an endless loop.
Benefits of Converting Credit Card Outstanding in EMIs
Converting that outstanding amount into EMIs comes with a range of benefits. Let’s have a look at them to get a better understanding of why we are advocating that you do so!
Enjoy Lower Interest Rates
The dreaded compounding interest is charged on the outstanding amount on the card and not on individual purchases, for e.g., if you have an outstanding amount of ₹1,00,000 on the card and you manage to pay off ₹20,000 it won’t do you any good as the interest would again begin piling up on the ₹80,000 that is outstanding which could quickly put you back to where you started. Converting the outstanding amount will offer you lower interest rates that can be managed and paid off in a much better and streamlined manner.
Flexible Repayment Tenures
Choosing the option of converting the outstanding amount to EMIs will give you a longer time period to settle the debt. Since you would be clearing the outstanding in small amounts, it’s a better way of managing finances compared to settling the minimum due since whatever outstanding amount is left after the minimum due is paid, is again levied interest and will continue to grow at an exponential pace turning your overall outstanding amount into a giant figure.
Save Your Credit History
A low credit score will deny you any new cards or loans; therefore, it’s a smart idea to ensure that you have a reasonable score to be eligible for future loan options. While not being able to pay your dues in time will reduce that score; converting the outstanding into EMIs will save your credit score from taking any damage.
If you have a credit card and have been struggling to pay off the outstanding amount, going in for a no cost EMI mobile option is a great idea to prevent financial strain and ensure that you can pay off the outstanding amount without damaging your credit score!
