Kotak Credit Card EMI

EMI Calculation Formula:

\[ EMI = \frac{P \times R \times (1+R)^N}{(1+R)^N - 1} \]

Equated Monthly Installment (EMI):

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1. What is EMI?

EMI (Equated Monthly Installment) is the fixed payment amount a borrower makes to a lender at a specified date each calendar month. For Kotak credit cards, this allows you to convert large purchases into manageable monthly payments.

2. How Does the Calculator Work?

The calculator uses the standard EMI formula:

\[ EMI = \frac{P \times R \times (1+R)^N}{(1+R)^N - 1} \]

Where:

\( P \) — Principal loan amount (INR)
\( R \) — Monthly interest rate (APR/12)
\( N \) — Loan tenure in months
\( EMI \) — Equated monthly installment (INR)

Explanation: The formula accounts for both principal repayment and interest payment components in each EMI.

3. Importance of EMI Calculation

Details: Calculating EMI helps in financial planning, comparing credit card options, and understanding the total cost of purchases made on EMI.

4. Using the Calculator

Tips: Enter principal amount in INR, annual interest rate (APR) in percentage, and tenure in months. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical APR for Kotak credit cards?
A: Kotak credit card APRs typically range from 24% to 48% per annum, depending on the card variant and customer profile.

Q2: Are there any processing fees for EMI conversion?
A: Kotak may charge a processing fee (usually 1-2% of the principal amount) for converting purchases to EMI.

Q3: Can I prepay my EMI?
A: Yes, but prepayment charges may apply. Check with Kotak for current prepayment policies.

Q4: How does EMI affect credit score?
A: Timely EMI payments can help build credit history, while missed payments negatively impact your score.

Q5: Is GST applicable on EMI interest?
A: Yes, 18% GST is applicable on the interest component of EMIs as per Indian tax laws.