What do the iPhone 6s, Nexus 6, and Moto X have in common? They’re all niche, flagship smartphones available from major manufacturers like Apple, Google, and Motorola respectively. Take the case of the iPhone 6s, for instance, it is being hailed as the most advanced iPhone ever released, and rightfully so (more on that later).

With the latest technological advances, phone makers around the world are churning out better, smarter devices every quarter. This current trend in the smartphone market has driven the manufacturers to come up with ground-breaking tech devices, which has obviously impacts the pricing of their products.

Financial institutions, in partnership with manufacturers, have caught up to this trend and are readily offering various EMI (Equated Monthly Instalment) options to prospective buyers. Although this trend was started by Apple, other notable smartphone makers followed suit to cater to the growing needs of aspiring, middle-class consumers.

So, this begs the question: Are ”affordable” EMIs on smartphones worth it? Well, before we delve into the debate on its pros and cons let’s first ascertain the basic aspects of an EMI.

So, what is an EMI?

An EMI is a payment mechanism that allows you to buy a product you desire (in this case, a smartphone) and pay for it over an extended period of time.

EMIs used to be exclusive to home and car loans, but have smoothly transitioned into electronics like smartphones.

Now, let’s address the elephant in the room. Is buying a smartphone on EMI a good idea?

Financing options aren’t purely black or white, especially now, with interest-free EMIs being provided by several lenders. Here, we’ve compiled the pros and cons of going the EMI route to fund your favourite smartphone. Let’s dig into the details and find out whether it is a viable option for you.

Smartphones on EMI: Pros

Imagine you have an outdated smartphone and want to upgrade to a better version that currently costs Rs.20,000 in the market. The problem is that the device you’re looking to buy is slightly over your budget. Here’s how going the EMI route benefits you.

Affordability

You don’t ever have to dwell on the fact that a dream smartphone you’ve always wanted is out of your price range. EMIs give you the luxury of affording any product you desire. If it’s beyond your current monetary reach, it puts it well within your grasp by giving you an option to pay for it via monthly instalments.

Flexible payment schedules

Once you buy a smartphone on EMI, you’ll have anywhere between 3-18 months to repay the entire amount. You can choose between a numbers of tenure options depending upon your financial situation. Tenure is the duration of time that you have to pay off the debt. Add to this the interest-free EMI options available today, and your shopping experience becomes a hassle-free one.

Smartphones on EMI: Cons

While there are several advantages of buying smartphones on EMIs, there are also some disadvantages that buyers might encounter.

Hidden charges

There are instances where lenders charge an extra sum to expedite your request. These charges may include processing fee (anywhere between Rs.200 to Rs.5000) and convenience fee (around 2%). What this means is that you may have to pay Rs.22,000 for a product that cost Rs.20,000. So always make sure to read the fineprint thoroughly before you take the plunge.

Foreclosure penalty

Say you’ve come upon a considerable amount of money and want to prepay your EMI amount and be done with it. You might have to shell out 2-3 % of the remaining principal as a penalty to foreclose the loan.

Long-term debt

Usually, EMIs are a long term payment and they tend to restrict your borrowing capacity until the current loan amount is cleared off.

What are the best smartphones to buy on EMI?

There are a number of smartphones available in India across different price ranges. Among these, there are a few you should definitely consider. Let’s take a look at them.

iPhone 6s – ‘s’ for Speed

Released in September this year, this exquisite device from Apple is known for its superior performance and unmatched build quality. It comes with some exciting, never-seen-before iPhone features like a 12 MP camera rear camera and a 5MP front camera (upgrade from 8 MP and 1.2MP respectively on its predecessors), 2GB RAM, and a great battery life, thanks to the 1715 mAh battery. On the accessibility front, the latest iPhone has 3D Touch which enables the users to perform different tasks depending on the pressure they apply.

Looking for a phone upgrade? Your timing couldn’t have been better! Here’s why the iPhone 6s should be your pick.

Nexus 6 – The boss of all android phones

The Google Nexus 6, by Motorola, is yet another top-notch smartphone you can buy on EMI. This device starts at Rs.INR 29,999 and offers the cleanest, untethered version of Android possible. This is backed up by features like a 13 MP camera, 3GB RAM, a 2.7 GHz Quad core processor, and a 3220 mAh battery. Popular among hardcore tech buffs around the world, this phone belongs on your wishlist for sure. If you are looking for a solid EMI option to purchase this device, you can opt for the Lifestyle Finance option by lenders like Bajaj Finserv, who offer loans of up to Rs.3 lakh with instant online approvals.

Moto X – For the next generation

Motorola has revisited its affordable flagship smartphone with the Moto X series and has captured the attention of millions of smartphone buyers around the world. With modest pricing, amazing features, and great performance, the Moto X’s have opened up a new dimension in the more-for-less category. For instance, the latest version of the phone—Moto X Play, features a whopping 21 MP camera, a 5.5 inch FHD display, a 1.7 GHz processor, and 2GB RAM all at a starting price of Rs.INR 19,499. These features and the low price point make it a strong contender when you’re smartphone hunting this festive season.

So what better way to finance this phone than with the interest free EMI deals offered by NBFCs like Bajaj Finserv EMI Network with other added benefits.

To sum it up, every mode of payment you choose has its own set of pros and cons. The EMI option may require you to spend more than the price of the product (if you aren’t diligent while sifting through the fine print). Full-cash payment may require you to tone down on your commitments and save up. But in the end you have to be able make a sound financial decision and see it through.

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