Today, EMI is no longer associated with card payments only. With the rise of digital transactions, many innovative digital solutions have emerged. Cardless EMI is one such solution that offers a hassle-free way to spread the cost of your purchases without needing a credit card.
With EMI transactions in India showing 220% growth since the pandemic, cardless EMI is just the convenience Indian shoppers are looking for.
But cardless EMI is not just about convenience. It is also about smart financial planning. In this blog, we dive deep into cardless EMI and understand why businesses should offer this convenience to their customers.
What is cardless EMI?
Cardless EMI is a user-friendly financing option for consumers who may not possess a credit card or prefer not to use one. It makes expensive items more accessible and affordable to such users with manageable monthly instalments, often with minimal or zero interest.
Several financial institutions and e-commerce platforms in India have introduced cardless EMI options. For instance, Paytm Postpaid, Amazon Pay EMI, and Flipkart Pay Later are popular cardless EMI services.
These services typically require users to complete a simple digital application process, and once approved, they can start shopping immediately with flexible repayment terms.
Some key features of cardless EMI include:
No need for a credit card
As the name suggests, cardless EMI eliminates the requirement for a credit card, making it accessible to a broader audience.
The application process is typically straightforward, requiring minimal documentation and quick approval.
Users can choose from various EMI plans tailored to their financial capabilities.
Low or zero interest
Many cardless EMI options offer low or even zero interest rates, reducing the overall cost of the purchase.
These services are widely accepted across numerous online and offline retailers, providing versatility in shopping choices.
How does cardless EMI work?
To use a cardless EMI, customers must ensure that the seller or platform they purchase from offers this option. Then, follow the steps below to avail the facility:
- Choose the product or service to purchase
- Proceed to the checkout page and select the ‘cardless EMI’ payment option
- Users will be prompted to fill out a straightforward loan application form. Fill out basic personal information, such as name, contact details, and Aadhar or PAN card details
- The EMI service provider will assess your creditworthiness based on the information provided. This process is often quick and can result in instant approval
- Choose from various EMI plans with different tenures and interest rates to suit different budgets
- Review the terms and conditions and confirm purchase
- Complete the purchase by making the initial down payment, if required, and the first EMI payment using a preferred payment method, such as debit cards, UPI, or net banking
The purchase is now complete. Subsequent instalments will get automatically deducted from your chosen payment method on the scheduled dates until the entire amount is paid off.
Why should businesses offer cardless EMI?
Cardless EMIs are convenient for customers and provide immense business benefits. For businesses that strive to meet their customers’ evolving needs and preferences, cardless EMIs may just be the key to enhancing their shopping experience.
Here are some compelling reasons why businesses should offer this alternative financing option to customers:
Reaching more customers
By offering a cardless EMI option, businesses can reach a wider audience who may not have access to credit or debit card EMIs. This opens doors to a whole new world of potential customers who can now afford your product or service.
Besides, this payment option is also appealing to millennials and Gen Z shoppers who look for flexible alternative payment methods.
Simplified checkout process
Going cardless brings simplicity to online shopping. It does away with the need to deal with complex card transactions.
Customers need to fill out their basic information, select an EMI plan, and voilà, they’re on their way to making a purchase.
Reduce cart abandonment
Almost 70% of e-commerce shoppers abandon their shopping carts on average, and a complicated checkout process is one of the top reasons for doing so.
Integrating flexible payment methods such as cardless EMIs encourages customers to complete their transactions, reducing cart abandonment rates.
Boosting sales and conversions
The ultimate goal of any business is to boost its sales and conversions. Offering a suite of flexible payment options, like cardless EMIs, can add tremendously to a company’s revenue.
When customers know they can spread their payments over time, they’re more likely to make that purchase decision. This drives up conversion rates, turning window shoppers into loyal customers.
Cutting processing costs
Credit card transactions often come with hefty processing fees and interest charges, with an average processing fee ranging from 1.5% to 3.5%.
But by going cardless, these costs can be significantly reduced, if not eliminated. Businesses can negotiate favourable terms with EMI service providers, ultimately saving money on transaction processing.
Competitive market advantage
Offering cardless EMI is a customer-centric approach that sets you apart from rivals who might not provide this flexible payment option. Customers are likelier to choose businesses that make their lives easier.
As much as 67% of consumers will stop a purchase if you do not provide their preferred payment option.
Improved customer loyalty
Cardless EMI not only attracts new customers but also fosters loyalty among existing ones.
When customers experience the convenience and affordability of EMI plans, they’re more likely to return for future purchases. Happy customers become repeat customers, which is the cornerstone of long-term success.
Faster approval and disbursement
Unlike traditional financing options that can be sluggish, cardless EMIs are often lightning-fast. Customers receive approval within minutes, enabling them to make their desired purchase promptly.
This speed can be a significant selling point for businesses, especially in industries where timing is critical.
Flexible payment option for customers
Lastly, businesses should offer cardless EMI because it’s all about providing flexibility to customers. In today’s dynamic financial landscape, people appreciate choices.
Cardless EMI empowers customers to choose how to pay, making high-ticket items more accessible without burning a hole in their pockets.
Offer cardless EMI to customers via Plural’s Affordability Suite
Boost your business and delight customers by offering cardless EMI through our Affordability Suite. This versatile solution empowers customers with various payment options, making their shopping experience seamless and budget-friendly.
With the our Affordability Suite, your customers can choose from various payment methods, including traditional card EMIs and brand EMIs, offering specific brands attractive financing options. We also feature’ The Buy Now Pay Later’ option that lets customers make purchases today and pay later, enhancing their purchasing power.
Further, the suite provides access to discounts, cashback, and exclusive offers, making shopping even more appealing, thereby increasing your sales and customer loyalty.
So don’t miss the opportunity to elevate your business with Plural Affordability Suite’s cardless EMI and other fantastic features. Contact us today!
Amrita Konaiagari is a Marketing Manager at Plural by Pine Labs and Editor of the Plural blog. She has over 10 years of marketing experience across Media & Tech industries and holds a Master’s degree in Communication and Journalism. She has a passion for home décor and is most definitely a dog person.