Understanding Credit Card EMI: A Comprehensive Guide

In the world of business, affordability is a growing concern for both companies and consumers. Traditionally, consumers who are unable to pay the full price of goods or services were left out of the shopping ecosystem. 

The only alternative was to apply for a personal loan and then make the purchase. However, this is a complex process which drives shoppers to avoid making purchases altogether. Today, the introduction of the credit card EMI (Equated Monthly Installments) is disrupting this narrative. 

According to the Reserve Bank of India (RBI), India had over 86 million credit cards in circulation as of April 2023, up from 75 million credit cards within one year. The promising growth in credit card usage has nudged the payment industry to introduce and promote credit card EMI as a convenient affordability option

Let’s understand how it works and how businesses can benefit from offering it as a payment option to consumers.  

What Is the Credit Card EMI Scheme?

Credit card users have the benefit of purchasing goods and services on credit and paying for them as per their credit card cycle. They can make decisions as per their cash flow to ensure that payments are made on time. 

With the introduction of credit card EMI, they have access to an additional feature that enables further convenience and flexibility in making repayments. 

The amount to be paid for any payment or service is broken down into instalments, thus easing the burden on consumers. They can structure the EMIs as per their expected cash flow cycles.

So, rather than delaying the purchase of a product or service, consumers can leverage this affordability payment option to serve their important needs promptly. They save the time and effort of alternatively taking a personal loan in case the existing credit limit does not cover their needs.

How Does the Credit Card EMI Work

The credit card EMI affordability option is offered to consumers at the point of sale. It can be accessed both online and during offline retail shopping. 

Say a consumer is shopping on a popular E-Commerce platform. Once they have added products or services to their cart and completed their shopping journey, they can start the check-out process.

They will be directed to a payment gateway, which displays multiple payment options – from debit cards and net banking to credit cards and Buy Now Pay Later.   

By choosing the credit card EMI option, consumers can decide on the flexibility of payments over several months rather than at the end of the credit card cycle. The flexibility of credit card EMI makes it an attractive option for cash flow-stapped consumers.

For instance, the upfront amount can be adjusted based on three other variables involved in the transaction – EMI amount, interest rate, and repayment tenure.

Once the payment goes through, the monthly EMI amount will be automatically deducted on the EMI payment cycle date from the consumer’s credit card balance. 

Consumers can also choose from two interest-related options. The zero-interest comes with a bonus – consumers end up paying no more than the cost price of their purchase, even with staggered payments. 

 Alternatively, if there is no zero-interest option, they may end up paying a slightly higher amount for the product or service based on the effective interest rate and other variables involved.   

Benefits of Credit Card EMI for Businesses

Here is a snapshot of advantages that businesses can benefit from by offering credit card EMI as a payment option:

Capture New Markets 

Businesses are always looking to attract new customers and expand their customer base. This affordability option opens new windows for existing credit card users, who can derive more value from their cards.

Businesses can attract customers with lower credit limits, who may not be in a position to purchase goods or services of a larger ticket size at one time. 

Customer Loyalty

The payment experience plays a critical role in helping businesses build customer loyalty in a competitive landscape.

By offering credit card EMI, businesses can encourage customers to come back and make purchases rather than wait for the next credit cycle to get started. 

Higher Customer Lifetime Value

A customer can afford to make more than one purchase at a time by exercising this option.

Businesses can benefit through increased customer lifetime value (CLV) with each shopping session. Increased CLV is a known metric for gauging a business’ success.  

Driving Revenues

Credit card EMI is a positive selling point for businesses.

Promoting this option actively can help drive revenues, especially during special occasions like festivals, sales, and when brand-new products hit the market. 


Affordability solutions such as credit card EMI have a strong impact on the way consumers fulfil their shopping needs. This option brings convenience, flexibility, and satisfaction to the experience by offering loans at the point of sale. 

The need to take an expensive personal loan is eliminated, thus saving time and effort for consumers. Businesses that offer such an opportunity will have an edge because they have the technology in place to respond to a growing market demand.  

The best approach for businesses is to partner with a payments technology specialist and fulfil their payment infrastructure needs with a state-of-the-art, user-friendly, secure payment gateway.   

Plural Gateway, a cutting-edge and comprehensive payment solution, enables businesses to offer credit card EMI as a payment option at the point of sale in the consumer’s shopping journey. They can choose the tenure, interest rate, EMI amount, and upfront payment amount at their convenience. The payment will be processed within minutes. 

Plural, additionally, powers other affordability options such as payment links in a consumer’s preferred channel of engagement, cardless EMI, and BNPL, giving consumers great freedom of choice. 

Plural Gateway is backed with industry-standard security systems to protect your customer’s data. With Plural Gateway, businesses can access an efficient integration experience and round-the-clock tech support. To learn more about Plural Gateway, write to us at pgsupport@pinelabs.com. 

Plural by Pine Labs has received an in-principle authorization from the Reserve Bank of India (RBI) to operate as a Payment Aggregator. 

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