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With the festive celebrations in full swing, Amazon Pay has introduced ‘EMI on RuPay credit cards’ across eight prominent issuing banks.
With EMI on RuPay Credit Cards, customers will get increased flexibility and affordability to shop during the festive period. During the first 48 hours of the Amazon Great Indian Festival, EMI’s emerged as the most preferred payment mode with 1 in 4 shopping orders placed on instalments; and 3 in 4 EMI orders on No Cost EMIs.
"The introduction of EMI on RuPay credit cards in partnership with NPCI will allow customers better access to credit, provide best-in-class value and help maximize savings. This will drive affordability and convenience of online shopping for customers across India, especially during the festive period," said Mayank Jain, Director - Credit and Lending, at Amazon Pay.
Amazon Pay offers a host of affordable and convenient payment options for customers, like Amazon Pay Later, Amazon Pay Wallet, UPI etc.
No-cost equated monthly instalment (EMI), also known as zero-cost EMI, is now a popular scheme as one can buy expensive items and can pay for them conveniently over a few months, as per their convenience without worrying about high interest and extra processing fees.
However, in a circular issued in September 17, 2013, RBI said that the concept of zero percent interest is nonexistent.
"In the zero percent EMI schemes offered on credit card outstandings, the interest element is often camouflaged and passed on to customer in the form of processing fee. Similarly, some banks were loading the expenses incurred in sourcing the loan (viz DSA commission) in the applicable RoI charged on the product. Since the very concept of zero percent interest is non-existent and fair practice demands that the processing charge and RoI charged should be kept uniform product/segment wise, irrespective of the sourcing channel, such schemes only serve the purpose of alluring and exploiting the vulnerable customers. The only factor that can justify differential RoI for the same product, tenor being the same, is the risk rating of the customer, which may not be applicable in case of retail products where the RoI is generally kept flat and is indifferent to the customer risk profile," noted RBI in 2013.
