The sad truth about people buying gadgets on EMIs is that most of them don’t even know the full form of EMI! Some people I know told me it stands for “Every Month Instalment” and some “End Month Instalment”. It actually stands for “Equated Monthly Instalment”.

They make fixed periodic payments, where we have to pay both interest and principal each month. This will be continued until the loan is paid off in full. When you buy smartphones on EMI, you actually end up paying more than the original amount, I repeat “MORE”!

We also have a formula for EMI:

And thus,

“Here P is the principal amount borrowed, A is the periodic amortization payment, r is the periodic interest rate divided by 100 (annual interest rate also divided by 12 in case of monthly installments), and n is the total number of payments (for a 30-year loan with monthly payments n = 30 × 12 = 360).” (via Wikipedia)

You can take out any product which is available on EMI and work out using this formula. You’ll find interesting and confusing results. Now let us get back to the post.

#### Buy Smartphones on EMI – The Scenario

Okay, so your budget is around 20K and you want to buy a smartphone worth of 35K, then you’ll obviously have no other choice than opting for EMI. As usual you’ll have those 0% interest and zero down payment blah blah to lure you. But in the end do you know you end up paying a lot more than the original amount you are suppose to pay? There are so many schemes for EMI and you might end up with a bad one. We have an exclusive video from Bloomberg about the EMI scheme and why it is not a smart option.

Do you buy Smartphones On EMI often? Have you bought any smartphone or gadgets via EMI? How was your experience? Kindly let us know in the comments below.

We can’t do bargaining

As we can fight offline on shops