Shopping & Money

No-Cost EMI Calculator: The Hidden Cost of "Free" EMI

Free tool · Updated October 2, 2026 · By CouponTalk

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Quick answer

In a no-cost EMI, the seller gives an upfront discount equal to the bank's interest, so your EMIs add up to the product price. But the bank still charges 18% GST on the interest part, plus a processing fee with 18% GST. On a ₹30,000 phone over 6 months at 15% a year, that adds roughly ₹460 to what you pay (₹229 GST on interest plus a ₹199 fee with GST).

How to use this calculator

Enter the product price shown with the no-cost EMI offer.
Choose the tenure and your card's EMI interest rate.
Enter the processing fee from the offer terms.

Formula

Monthly EMI = Price ÷ Months (the interest is given as a discount)

Interest inside the EMIs = Price − Present value of the EMIs at the bank rate

Extra cost = Interest × 18% GST + Processing fee × 1.18

Results are estimates to help you plan. Confirm the final price, tax and offer terms at checkout.

Frequently asked questions

Is no-cost EMI really free?

Not fully. The interest is offset by a discount, but you pay 18% GST on the interest component and usually a processing fee with GST. Some sellers also exclude other discounts on no-cost EMI.

Does no-cost EMI affect my credit score?

It uses your credit card limit or a pay-later line. Paying every EMI on time is fine; missed payments hurt your score.