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Credit Card EMI vs Personal Loan

Convert a big swipe to EMI on the card or take a fresh personal loan? We compare the true cost including processing fees and GST.

₹1,00,000
12 mo

Credit Card EMI

15.0%
2.0%

Personal Loan

11.5%
1.0%

Credit Card EMI

EMI₹9,026
Interest₹8,310
Processing + GST₹2,360
Total cost₹1,10,670

Personal Loan

EMI₹8,862
Interest₹6,338
Processing + GST₹1,180
Total cost₹1,07,518
Personal Loan wins by ₹3,152

How it works

We compute the EMI for the credit card path using reducing-balance interest plus a one-time processing fee (1–2% + 18% GST) added upfront. We do the same for a personal loan with its own rate (typically 10.5–16% from HDFC, ICICI, SBI YONO, BAJAJ Finserv) and processing fee (1–3%). The card path also blocks your credit limit until cleared, so we flag that. Total cost = principal + interest + processing fee + GST on fee.

Worked example

A ₹1,20,000 MacBook on an HDFC card converted to 12-month EMI at 14% costs ~₹10,775/month with a ₹1,200 processing fee + 18% GST = total outflow ~₹1,30,720. A pre-approved personal loan at 11.5% for 12 months on the same amount comes to ~₹10,640/month, processing ₹1,500 + GST = total ~₹1,29,250. Personal loan saves ~₹1,500. Below 6-month tenure, card EMI usually wins because the personal-loan processing fee is fixed.

When to use this

  • Big swipe on Flipkart Big Billion Day or Amazon Great Indian Festival
  • Choosing between Bajaj Finserv EMI (No-Cost) and a fresh personal loan
  • Comparing balance-transfer offers from one card issuer to another

For the trap of paying only the minimum due, see our credit card minimum payment calculator. For ordinary loan EMI math, use the EMI calculator.

FAQ

Is CC EMI cheaper than personal loan?

Sometimes. CC EMI rates are 13-16% (usually fixed), comparable to personal loan rates. The decider is processing fees: CC EMI has 1-3% fee, personal loan 1-2.5%. For small amounts (≤ ₹50k), CC EMI often wins. For larger, personal loan typically does.

Does CC EMI affect my CC available limit?

Yes — the converted amount is locked. Your available limit drops by the EMI principal until repayment progresses. Some banks restore limit gradually as EMIs are paid; others only at full closure.

Can I prepay a CC EMI?

Yes, but most banks charge a foreclosure fee (3-5%) plus GST. For floating-rate personal loans, RBI prohibits prepayment penalty for individual non-business loans. Check your CC EMI agreement.