Although the Reserve Bank of India has banned zero per cent interest schemes on electronic gadgets purchased using credit card, the scheme is available for the customers who prefer Equitable Monthly Installment (EMI) system to shop.
According to shopkeepers, these schemes are profitable for the companies and are introduced especially during the festive season to enhance the sale of the products. According to Ashutosh Kochar of The Indian Stores in Paltan Bazaar, traditionally Diwali is the best time for buying electronic items.
The market, too, is trying to commercialise the traditional practice of people of purchasing items during Diwali, by introducing such lucrative schemes during festive season.
Kochar further said that the zero per cent interest schemes have become quite popular among customers these days as it provides an opportunity to buy products in several small and affordable installments.
He also revealed that generally the shopkeepers and the financing companies have pre-planned tie-ups and launch such schemes under this profitable plan. Such lucrative schemes are introduced to increase the sale of the products during the festive time.
These schemes are launched in a planned manner after conducting several surveys, revealed Kochar. He added that it also augments the demands for the products during festive season.
He said that the zero per cent interest schemes are designed in such a way that the companies always benefit from it. Generally, the facility is kept interest free only if the installment period is for a particular and limited period. When a customer buys a product on EMI and the monthly installment period is fixed for eight months, then no interest will be levied on the customer. But if the EMI period exceeds one year, then the customer will be charged interest in general.
According to Vipin Nagaliya, President of Doon Udhyog Vyapar Mandal, the zero per cent interest schemes are meant just to attract customers in large quantities during the festival time.
These schemes usually benefit the financing company and the shopkeepers as increase in the sale and demand of products are recorded during this time period. He added that the manufacturing companies are also benefitted by such schemes.
Vivek Arora of Frontier Electronics at New Market informed that the zero per cent interest scheme is just a marketing strategy of the financing companies and the shopkeepers to enhance the sale of the product.
Another shopkeeper, Mohit Kumar of MK Communication, said that, every year the financing companies launch these zero per cent interest schemes to increase the sale of the product. Pradeep Rawat of Doon Music Centre at Paltan Bazaar, said that EMI shopping has become quite affordable and convenient medium among customers.