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About Credit Card EMI

Purchasing big-ticket items with a credit card can strain your finances significantly. As a possible solution, a majority of credit card issuing authorities offer a special advantage known as the ‘Credit Card EMI’ facility.

 Using this facility, you can avoid paying the entire amount at once and convert the amount into small monthly instalments, i.e. Equated Monthly Instalments or EMIs. What’s more! Using the ‘Credit Card EMI’ facility, you get the chance to choose a suitable repayment tenure and clear the dues accordingly without straining your budget.

Types of Credit Card EMI Options Offered by Banks

Generally, banks offer the following credit card EMI options to their cardholders:

  • Zero-Interest Rate EMI

When you opt for the zero-interest-rate EMI (often referred to as no-cost EMI), you need not pay any extra interest rate on the purchase. Simply said, with a no-cost EMI credit card, you are only paying for the total price of the product and no extra finance charges.

  • EMI on Interest

In the case of an EMI on interest, you are charged at a lower range of 1.25%-1.99% monthly. Here, you have to ensure that you clear the dues at the earliest to reduce the interest component on your repayment amount. The longer the tenure, the higher will be the interest paid.

Note: Depending on the credit card issuer, the credit card EMI interest rates, processing charges, and other features and services will vary. It is advised to take into account all the fees and charges levied by your credit card issuer before opting for any of the above-mentioned credit card EMI options.

You can refer to the table given below to know the credit card EMI interest rates of top banks in India:


Interest Rate



20% p.a.

6 to 24 months


Will be disclosed at the time of availing credit card EMI facility

6 to 48 months

Kotak Mahindra Bank

12%- 18%

3 to 36 months


Will be disclosed at the time of availing credit card EMI facility

6 to 24 months

Axis Bank

1.5% p.m. (18% p.a.)

6 to 24 months

RBL Bank

Will be disclosed at the time of availing credit card EMI facility

3 to 24 months

Bank of Baroda (Instant EMI)

13%- 15%

3 to 24 months


How Does Credit Card EMI Work

The credit card EMI facility lets you borrow funds on your credit card and pay for the items you wish to purchase. You can then decide on a repayment tenure during and pay back every month a portion of that amount and any other additional charges as EMI.

Let us understand with an example.

Suppose you wish to buy a high-end phone which is priced at ₹1 lakh. In case you can currently afford only ₹50,000 as the down payment, you can convert the remaining amount into easy EMIs with your credit card. Let us assume that the EMI tenure is 12 months and the rate of interest decided by the credit card issuer is 10%. 

Using a credit card EMI calculator, you can calculate that you will need to pay ₹4,396 monthly during the EMI tenure to clear your dues.

Thus, paying a small instalment of ₹4,396 could put less strain on your finances than paying the entire amount in one go.

How to Convert Credit Card Bill Into EMI

There are primarily two ways of converting credit card (CC) bills into EMI. The first one is the Merchant EMI which enables you to convert your credit card bill at the time of the purchase. Several banks have partnered with online shopping portals as well as retailers to make the EMI facility accessible to all. 

You can make a down payment with the funds available with you and the rest can be converted into EMIs by choosing a preferable tenure. Once processed, the repayment schedule would be sent to you by mail and the payable amount would reflect in your credit card statement.

Post-purchase EMI conversion is the second way to convert the credit card bill to EMI. Here, you can convert your credit card bills by visiting the bank’s website or mobile app or by calling the bank’s credit card customer care helpline number.

Apply for Credit Card EMI Online via Netbanking

  • Step 1: Log into your credit card netbanking account.

  • Step 2: Go to the ‘Credit Cards’ section and select ‘Convert to EMI’.

  • Step 3: Choose the card and the transaction you wish to convert into EMI. Then, proceed to choose the transaction tenure, total amount, and the rate of interest.

  • Step 5: Click on ‘Submit’.

Apply for Credit Card EMI Offline

You can apply for ‘Credit Card EMI’ facility offline by calling the 24x7 helpline number of the credit card issuing bank or physically visiting the bank and submitting a written request.

Advantages of Converting Your Credit Card Bill to EMI

Converting your credit card purchases into EMI has several advantages:

  • Interest Rate: The credit card EMI interest rate depends on the tenure you choose, i.e., shorter tenure implies lower interest rate, while longer tenure attracts a higher interest rate.

  • Reducing Interest Rate: While levying credit card EMI interest rate, issuing authorities follow the reducing balance method. To be precise, interest is charged at the end of every month on the loan balance. As you repay every month, the interest charges keep reducing and you end up paying less interest amount with every passing month.

  • Flexible Repayment Tenure: Most banks offer a convenient repayment tenure usually ranging between 3 and 24 months. The tenure is long enough to repay the amount without straining your finances.

  • Offer on Processing Fee: Banks introduce offers from time to time for specific periods  when charges such as processing fee are reduced or waived off, which makes it ideal for saving more money.

  • Save on Foreclosure Charges: You can decide to close the credit card EMI process before the completion of tenure by paying a foreclosure charge, which may not be applicable in some cases.

How to Calculate Credit Card EMI

To calculate the credit card bill EMI, you must take into account the fees and charges, like interest rate and processing fees, levied by the bank. The credit card EMI would then be a product of the tenure, interest rate, processing charges, and the total amount left to be repaid. You can also use the online credit card EMI calculators to calculate the amount you must pay when you convert your credit card bill into EMI.

Things to Keep in Mind While Opting for an EMI on Credit Cards

You must be aware of a few important details if you want to get an EMI on your credit card. Here is a brief overview of the considerations you would need to make while choosing an EMI.

  • Not Every Credit Card Offers an EMI Option: Check to see if your credit card provides the option before turning your purchase into an EMI. When making a purchase, there have been instances where cardholders discovered later that their card didn’t offer the said feature.

  • Your Card's Limit is Decreased by EMI Purchases: Each purchase you make, with or without an EMI, has an impact on your ability to spend. If you use the EMI facility to buy goods for ₹30,000, your credit limit is reduced by this amount. Therefore, if your credit limit is ₹50,000 and you spend ₹30,000, your limit is now ₹20,000. When you continue making on-time EMI payments, your credit limit would rise.

  • The Fees for Processing EMIs is Negotiable: Banks typically levy a processing fee on your principal amount if you choose the EMI option. Based on your card and the purchase amount, the fee may be a tiny percentage of your loan balance or a fixed amount. If you have an excellent repayment history and their brand loyalty, you may be able to negotiate with the bank to receive a waiver.

  • Choose Online Shopping: Online retailers like Amazon, Flipkart, and others have partnered with merchant banks to provide the EMI option in an effort to increase sales. By skipping the cost of the retail commission, you can not only receive a good bargain but also save more. Some retailers also provide better EMI options spanning from 3 to 24 months.

  • You May be Eligible for a Prepayment Penalty Waiver: Prepayment penalties are typically included in credit card EMI plans, and they entail a percentage fee for paying off your remaining debt early.

  • Make All of Your Payments on Time and in Full: Debt from credit cards can be significantly expensive. Therefore, it's crucial to pay your bills on time and avoid leaving any balances because doing so will result in fees and increased interest rates.

Fees and Charges Applicable for Converting Credit Card Payment to EMI

The credit card EMI conversion procedure attracts certain fees and charges which vary from bank to bank. Following are the details of such fees and charges levied against your credit card EMI.

  • Interest Rate: An EMI interest rate is charged on the credit card bill once converted into EMI. This depends on several factors such as card type, your repayment history, etc.

  • Processing Fee: A processing fee, ranging up to 3% of the total amount transacted, may be charged by the bank on the basis of your credit card type.

  • GST: 18% Goods and Services Tax will be levied on all fees and charges as a part of the government directive.

  • Foreclosure Charges: Closing the loan before the end of the tenure can attract up to 3% of the outstanding dues as foreclosure charges. Pro-rata interest charges can also be levied in such a case.

FAQs on Credit Card EMI

✔️Why should I convert credit card purchases into EMI?

 You can choose to convert your credit card purchase into EMI for a number of reasons such as to enjoy lower interest rate, select convenient repayment tenor, get offers on processing fee, and many more.

✔️Do all credit cards have the EMI facility?

 Some credit cards come with the EMI conversion facility. You must learn about the features and offers associated with your existing credit card before purchasing any products or apply for a new credit card that allows you to enjoy the credit card EMI conversion facility.

✔️Is the EMI option cheaper than regular credit card payments?

 No, the EMI option is not cheaper than the regular credit card payments. If you opt for the credit card EMI conversion facility (except no-cost EMI), you have to pay an interest charge on the principal.

✔️What happens if I pay more than my EMI amount?

 If you pay a certain amount in a month which is more than your EMI, the excess balance will be updated in the credit card statement and adjusted against the due balance in the following month.

✔️Is credit card EMI interest-free?

 Some credit card EMI is interest-free. However, in most of the cases, you have to pay a reduced interest rate on credit card EMIs.

✔️Is EMI on a credit card good?

 Banks charge reduced interest rates on credit card EMIs, which is certainly lower than the finance charges imposed on the unpaid credit card balances. However, if you opt for EMI conversion facility on credit card, you are still required to pay additional interest charge on your credit card bill. Hence, you must decide all the associated costs before availing such service.

✔️What happens if I return the items purchased on EMI?

 If the item is returned before the EMI conversion has been processed, the entire amount is refunded. However, if the EMI conversion has been processed before the item has been returned, the entire amount may not be returned to you and you might need to pay GST, interest, and preclosure charges. However, if you have applied for the option of no-cost EMI on credit card, no fees will be charged, and you would get the amount back in full.

✔️How will my EMI be calculated?

Banks generally calculate credit card EMIs by using a simple mathematical formula. Here’s a quick look at what it is.

Credit Card EMI = [Loan Amount + (Loan Amount x Rate of Interest per month x Tenor in months)] ÷ Tenor in months

✔️Can I pay off my credit card EMIs in one go?

Yes. You can pay off your entire credit card EMIs through a single payment. However, banks usually levy a pre-closure charge in the form of a percentage of the outstanding loan for opting for this feature. 

✔️What will happen if I pay more than my EMI amount?

If you end up paying more than your EMI, the excess amount that you pay will be adjusted against the next month’s total outstanding amount. 

✔️Does the bank charge any processing fee on credit card EMI conversions?

Yes. Many banks levy processing fees for EMI conversions. This fee can range anywhere from ₹99 to ₹199 per EMI conversion. However, there are a few banks that don’t levy any processing fee as well.

✔️Will I be able to make purchases on EMIs if I don't have a credit card?

Yes. With the Bajaj Finserv EMI Network Card, you can purchase all your favourite products on EMI even if you don’t have a credit card.

✔️How much is the rate of interest on credit card EMI?

The rate of interest on credit card EMI varies from one bank to another. It starts from 12.5% per annum. 


✔️Can I pay my credit card EMI early?

Any excess amount paid against your EMI will appear on your credit card statement and will be deducted from the balance you owe for the following month.