How to Check Debit Card EMI Eligibility?

Several Indian banks have recently introduced EMI (Equated Monthly Instalments) option on debit cards. It is an easy and affordable way to make big-ticket purchases without having to worry about the erosion of savings. However, only eligible cardholders can avail of this option. In this article, we have explained in detail how to check debit card EMI eligibility and how debit card EMI works.

What is EMI on a Debit Card?

A debit card EMI is a payment facility available on certain debit cards that allows you to convert your online or offline purchases into small, affordable EMIs. It is similar to a credit card but is considered an overdraft by the bank, and the bank makes the payment to the merchant on your behalf.

Once the payment is made, the bank cuts a certain amount from your account every month as EMI. The debit card EMI is calculated based on the amount you spend, your chosen tenure, and the interest rate the bank charges. Since it is an overdraft facility, the bank levies the applicable interest rate.

A debit card EMI is beneficial for people who do not qualify to get a credit card or who are not comfortable using a credit card. Moreover, it is also useful for people who do not want to erode their savings while making a big ticket purchase.

In India, the following banks offer EMI on debit cards:

• HDFC Bank
• SBI
• ICICI Bank
• Kotak Bank
• Axis Bank
• Federal Bank
• IDFC First Bank
• Punjab National Bank
• IndusInd Bank

Features and Benefits of Debit Card EMI

The following are the features and benefits of debit card EMI.

• Flexible repayment option: Banks allow you to select a tenure between 3 and 36 months to repay your debit card EMI dues.
• No documentation: To get an overdraft facility on your debit card, you do not have to submit any documents or wait for the bank’s approval.
• Easy money: When you make big-ticket purchases above Rs 5,000 and do not want to create a dent in your savings, you can use the debit card EMI facility. Banks usually allow transactions ranging between Rs 5,000 and Rs 5 lakh for an EMI facility on a debit card. The minimum and maximum transaction limit varies across banks.
• Instant approval: Unlike credit cards, you do not have to wait for days or weeks to get the bank’s approval to use the EMI facility on your debit card.
• No down payment: When you use a debit card EMI facility at any of the approved merchants, you need not pay any down payment. The bank will give you 100% finance on your purchase.
• Pre-closure: When you have surplus funds, you can pre-close your loan. However, some banks can charge a small fee for the pre-closure of your debit card EMIs.

How Does Debit Card EMI Work?

A debit card EMI is a convenient option to make purchases online and offline in affordable instalments using your debit card. When you make a purchase online, you will be presented with an option of debit card EMI at the time of checkout. You will have to choose that option to avail a debit card EMI. After the approval from the bank and the merchant, the amount will be credited to your bank account by the bank. You will have to repay this amount in small instalments during the tenure. The bank usually auto-debits your account every month until you repay your dues in full.

For offline purchases, you must tell the merchant to swipe the card in debit card EMI mode and punch in the desired tenure. The bank will sanction the transaction as per the balance in your savings account. The transaction is rejected if the limit in your savings account is less than the purchase you make. After the transaction is approved, you sign the charge slip agreeing to all the terms and conditions, and the money you spent for purchasing the product via debit card EMI mode will be credited to your account within three days. The bank then debits the EMI amount every month until you repay your dues.

How to Check Debit Card EMI Eligibility?

The debit card EMI facility is available only with some banks and to only certain customers. Hence, checking the debit card EMI eligibility is important before purchasing. Usually, you can check the debit card EMI eligibility through the SMS banking facility. You are required to send an SMS from your registered mobile number to check whether your debit card has the EMI facility. The following are SMS codes to check the debit card EMI eligibility of top banks.

Last updated: 18th Jan 2024

How to Apply for an EMI Facility on a Debit Card?

The following is the process of availing EMI on our debit card.

• Check your eligibility: if you hold a debit card from any bank, check whether the debit card EMI is available to you. You can use the SMS codes given above to check whether the facility is available to you.
• Check for product eligibility: The EMI facility is only available on certain products. Hence, checking whether the product has a debit card EMI facility is important.
• Select the option: On the checkout page of your shopping website, select a debit card, and then select the EMI option.
• Select the tenure: You must select the tenure that is comfortable for you. Banks usually offer a tenure ranging from 3 months to 36 months.
• Authenticate: After providing all the necessary details, authenticate the transaction with an OTP.
• Refund: The banks block the amount you purchased in your bank account until the EMI transaction is complete. Once the EMI transaction is complete, the bank will deposit the money you purchased into your account.
• EMI payment: From the next month onwards, the bank will debit the EMI amount from your account.

Fees and Charges of Debit Card EMI Facility

Banks charge certain fees to make the debit card EMI option available to you. It is important that you know all the charges associated with debit card EMI. The following are the different fees the bank charges, which vary across banks.

• Processing fee: banks charge a processing fee from you to cover the administrative costs associated with converting a purchase into instalments.
• Interest: Interest is charged on the loan you take through your debit card. This ranges between 10-30% per annum.
• Late payment fee: In case you fail to repay your EMI or pay it partially, banks charge a certain penalty on the outstanding EMI.
• Auto debit return: In case you do not have sufficient funds and the auto-debit transaction fails, then banks charge a penalty.
• Pre-closure charge: Many banks also charge a pre-closure penalty if you close your debit card EMI loan earlier than the due date.

Things to Keep in Mind Before Opting for Debit Card EMI Facility

Before using the debit card EMI facility, it is important to keep in mind the following points.

• Eligibility: Only eligible cards and cardholders have the EMI facility on the debit card. Hence, it is best to check with your bank for the same.
• Availability: Certain product categories and merchants have the option of debit card EMI. Hence, check with the merchant before buying a product.
• Opting for EMI: Whether it is an online or offline purchase, make sure you select the debit card EMI option. 
• Fees and other charges: Understand the fees and other charges that the bank will levy on your purchase before the option for the debit card EMI.
• Repayment: Make sure you repay your debit card EMI dues on time to avoid late fees and penalties.

Difference between Debit Card EMI and Credit Card EMI

The following table highlights the difference between debit card EMI and credit card EMI.

Conclusion

Debit card EMI is an excellent credit facility available to debit card users to make big-ticket purchases. It can help you repay your dues in affordable instalments without having to rely on credit cards. However, it is important to note that only eligible card holders can avail of this facility, and the banks charge fees and penalties upon late payment of your dues. Hence, it is important to use the debit card EMI facility with utmost caution, similar to a credit card EMI option.

Frequently Asked Questions

Can I get EMI on a debit card?

Several banks allow users to convert their purchases on debit cards to EMI right at the time of making the purchase. You can check with your bank whether your card is eligible for debit card EMI facility.

When is EMI deducted from the debit card?

The EMI is deducted on a monthly basis from your savings account starting 30 days from your purchase.

Can I get a loan on a debit card?

You can convert a purchase you make on your debit card into an affordable EMI by opting for the debit card EMI option at the time of making the purchase.

Which banks allow Debit Card EMI?

There are several banks that allow debit card EMI facilities. Some of them are HDFC Bank, SBI, Kotak Mahindra Bank, Axis Bank, and IndusInd Bank.

How can I activate my Debit Card EMI?

To activate your debit card EMI option, swipe your debit card at any pre-approved merchant using a card that has the debit card EMI facility. Before entering your PIN, select the debit card EMI option and confirm the transaction with your debit card PIN.

Is debit card EMI good?

Yes, debit card EMIs are considered a good option as they help in making big-ticket purchases without having to worry about the erosion of savings.

How can I qualify for HDFC debit card EMI?

You can check whether you are eligible for a debit card EMI facility at HDFC. You can send an SMS to 5676712 by typing ‘MYHDFC’. The bank will tell you whether you are eligible or not.

What is the difference between Debit Card EMI and No Cost EMI?

In case of no-cost EMI, you will not pay any interest or processing fee. However, in the case of debit card EMI, you will have to pay the charges and fees associated with it.

What happens if I don’t pay my debit card EMI?

In case of non-repayment or late payment, you will have to pay a late payment fee charged by the bank. The charges vary across banks and are typically a fixed sum of money along with GST.