EMI system - Good or bad for middle class people?

by Lakshmi Narayanan in General Discussions

2 84 579

10 years ago

EMI - Equated Monthly Installments. This system is more popular in India. It is used in all commercial departments that are connected with a common man. People who are not affordable to purchase or buy any product in full cash opts for EMI and pays in installments. On one side this is more useful for middle class people. But on other hand, it might tend to huge burden on a person's head.

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Harsha

1 28 396

10 years ago

#385110

Definitely EMI system helps middle class people to buy the costly products in an installment basis. Though EMI system accepts some extra charges as interest, middle class people reduce some of their expenditures and are able to pay low costs every month instead of buying at a time. Now a days some of the online shopping sites are providing the new facility called "Get back your interest at the ending payment". This procedure can even help middle class people a lot.

Gulshan Kumar Ajmani

3.48k 21.9k 176.9k

10 years ago

#385119

EMI or equated monthly system is good scheme for buying durables. Personally I do not favor any loan except housing. Needless to say EMI rduces the monthly disposable income.

G. K. Ajmani Tax consultant
http://gkajmani-mystraythoughts.blogspot.com/

Dwarakanathan

75 1.12k 8.27k

10 years ago

#385123

EMI system is best for the people who regularly make prompt payments. But nowadays people are misusing it by purchasing lot of things and not able to pay their loan within stipulated time. For those people it is not suitable. It reduces the burden of paying the money immediately.

Mousumi Ghosh

59 2.72k 23k

10 years ago

#385128

EMI - Equated Monthly Installments. This system is more popular in India. It is used in all commercial departments that are connected with a common man. People who are not affordable to purchase or buy any product in full cash opts for EMI and pays in installments. On one side this is more useful for middle class people. But on other hand, it might tend to huge burden on a person's head.

EMI is a very good way to spread out one's expenses throughout a year or over a period of time, instead of buying things using cash at one go. Though I used to be in favor of buying things using cash...but EMI options lets you plan and budget for things that you want to buy and then the burden is spread over each month instead of spending money in bulk or at one go.

“A mistake is a crash-course in learning” – Billy Anderson

usha manohar

704 19.5k 126.1k

10 years ago

#385137

In the long run although you end up paying nearly double the amount, it is still a boon to many people who cannot pay upfront at one go ! I guess both the customer and the seller are happy since the customer gets his stuff right at the beginning and gets to use it, and sometimes before the end of the term, may be even exchange it ..seller of course makes a good profit!

Pay no mind to those who talk behind your back, it simply means that you are two steps ahead !!!

Mousumi Ghosh

59 2.72k 23k

10 years ago

#385168

But if the customer is lucky..s/he gets a product at zero percent interest rate....mostly during festive season.

“A mistake is a crash-course in learning” – Billy Anderson

Dwarakanathan

75 1.12k 8.27k

10 years ago

#385179

But if the customer is lucky..s/he gets a product at zero percent interest rate....mostly during festive season.

Zero percent interest means it is not free from interest. You have some hidden cost like processing fees are involved in it. If you calculate that you come to know that you are spending more money than the actual cost.

Gulshan Kumar Ajmani

3.48k 21.9k 176.9k

10 years ago

#385180

But if the customer is lucky..s/he gets a product at zero percent interest rate....mostly during festive season.

Zero percent interest means it is not free from interest. You have some hidden cost like processing fees are involved in it. If you calculate that you come to know that you are spending more money than the actual cost.

Nothing is free as such. One should be cautios not to over use the EMI facility. In a zeal to buy more durables, the disposal income for current needs is drastically reduced thereby causing hardship.

G. K. Ajmani Tax consultant
http://gkajmani-mystraythoughts.blogspot.com/

mohan manohar

52 3.75k 21.9k

10 years ago

#385183

Any kind of loan is cancer. It is always good idea to avoid it.

http://mohanmekap.com/

Suny Ag

253 20k 141.2k

10 years ago

#385202

EMI - Equated Monthly Installments. This system is more popular in India. It is used in all commercial departments that are connected with a common man. People who are not affordable to purchase or buy any product in full cash opts for EMI and pays in installments. On one side this is more useful for middle class people. But on other hand, it might tend to huge burden on a person's head.

This system is more poplar all over the world, We have just bough a home in a foreign country on EMI basis where bank interest is only 5%. And most businessmen and corporate workers do it to keep their capital intact not necessarily the people who cannot afford to buy in cash.

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