Saving, investing and managing your spending are important financial habits that are built over a period of time. Growing up, my parents, like most Indian parents, had ingrained in me the importance of getting maximum value out of any money spent. At a very early stage in life, I learnt that while looking for value out of a product or service that an individual spends money on, he can also build up the pathway to improving his financial health. With the availability of instant credit facility and credit cards, an individual can easily get his hands on the desired product and service whilst also improving his financial status.

Consumer Credit Penetration in India is Low

There are only 3 credit cards for every 100 people in India in comparison to 320 in the USA. With only 3 per cent adults using credit cards which is considered be a low number in terms of penetration, fintechs today see a good opportunity for serving the underserved credit worthy individuals. While the cost of distribution and operation of making the credit card available to an individual is high with the usage of traditional channels, many fintechs and even e-commerce platforms have now started offering easy EMIs, NO cost and buy now pay later facilities to make small as well as large ticket size products available to first time as well as existing borrowers.

Lenders are Now Offering No Cost and Buy Now Pay Later Options

While most of us focus on getting the best deal on product or service, we often miss out on checking the additional benefits that we would be able to avail. With lenders offering no cost EMI schemes, one can make the purchase of the product or service without paying any interest. With buy now pay later option that enables an individual to make the purchase first and pay later can actually help an individual accelerate his credit history if the payments are made on time.

No Cost EMIs, credit card offers, buy now pay later option have become an essential part of the shopping Festivals promoted by e-commerce players like Amazon and Flipkart.

It’s Not Just About Savings, but Also About Improving Finances

Apart from the immediate savings that a No Cost EMI or a Buy Now Pay later option would offer, a plethora of other benefits which also help in improving finances are:

a. Timely repayments can help you increase your credit score

b. Get access to larger credit lines in times of emergency

c. Qualify for large secured loans like auto or home

d. Reduce your interest costs by up to 30 per cent

If you pay using credit cards, you can also earn rewards points. Using credit cards wisely can open up a world of benefits for you.

For example, if you have a HDFC credit card, then its smart buy, its platform can help you get affordable deals on shopping, flight booking, hotel booking, helping you get 10X reward points! How, you ask?

a. For Amazon and Flipkart – Simply start your online journey by clicking on the

online shopping site from their website. After that you can navigate on

Amazon or Flipkart entering your mobile number and last 4 digits of your card number-both debit or credit card.

b. For other online and offline stores – Buy instant vouchers and then redeem

them while making the purchase.

It’s important to note that leveraging credit does not have to mean you incur debt; instead, you can use your financial reputation to work towards your financial advantage. While availing credit facility, ensure you read all the terms and conditions and buy only what fits your budget. Moreover, ensure time repayments to ensure your credit score does not decrease. If you don’t qualify for no cost EMI, credit card or BNPL option, opt for a loan from fintech lenders as you can get the loan at a low interest rate and credit score.

The author is Founder, Credit Fair

DISCLAIMER: Views expressed are the author’s own, and Outlook Money does not necessarily subscribe to them. Outlook Money shall not be responsible for any damage caused to any person/organisation directly or indirectly.