What is No Cost EMI | NO Cost EMI | Explained in Hindi with Example | Expert Vakil |
Normal EMI: In regular EMI there is a Interest rate and Processing fee, the interest rate lies between 8% to 15%, and the processing fee lies between 0.5% to 3%. So if you have bought a product on EMI of Rs.12000 which is to be paid back in 6 months, then the calculation is like this –
(EMI=Rs.12000, Tenure = 6 months, Rate of interest = 12% , Processing fee = 2%)
Then every month you have to pay is Rs. 2157 , where the loan amount is Rs. 12,000, Total interest to be paid is Rs.441, Total Processing fee is Rs.250, Therefore the total amount payable is Rs. 12,691.
No-Cost-EMI: In no cost EMI, the interest rate and processing fee is 0%, so if you habe bought a product on EMI of Rs.12000, which is to be paid back in 6 months the the calculation us like this-
(EMI = Rs.12000, Tenure = 6 months, Rate of interest = 0%, Processing fee = 0%)
Then every month you have to pay Rs.2000, where the loan amount is Rs.12000, Total Interest paid is Rs.0, Total Processing fee is Rs.0, Therefore the total amount payble is Rs.12000.
