how to cancel EMI on credit card?

cancelling an equated monthly installment (EMI) on an   credit card is possible, but the process and charges depend on when the request is made. the best time to cancel is within 15 days of the EMI conversion. after that period, cancellation becomes more expensive and may not be worth it.

the 15-day window

  bank allows EMI cancellation without any charges if the request is made within 15 calendar days of the EMI being booked. during this period:

• no cancellation or foreclosure fees apply
• the processing fee and Goods and Services Tax (GST) are reversed
• the transaction is treated as a regular credit card purchase

this is the most effective way to cancel an EMI. the borrower avoids paying any penalty and gets the full purchase amount reflected as a normal transaction on the credit card statement.

cancellation after 15 days

once the 15-day window passes, EMI cancellation is still possible but comes with charges. the foreclosure fee is typically 3% of the outstanding principal amount. additional charges like the next month's interest may also apply.

on a ₹1,00,000 EMI, a 3% foreclosure charge works out to about ₹3,000. the interest for the upcoming month adds another ₹1,000 approximately. the total cost of cancelling after the 15-day window can be around ₹4,000.

important exception: discount-linked EMIs

if the EMI was availed along with an instant discount or special offer, the cancellation rules may differ. has a specific clause stating that EMIs for which an instant discount was given may not be eligible for cancellation within 17 days of EMI booking.

in such cases, the discount received may be recovered or adjusted if the EMI is cancelled early. this is important to check before requesting cancellation.

how to cancel an   credit card EMI

step 1: call customer care. the most reliable way to cancel an EMI is through a phone call. the borrower can call the   customer care number and request cancellation of the specific EMI. the EMI can be cancelled immediately over the call.

step 2: ensure the transaction is settled. it is advisable to check that the transaction has been converted to EMI before calling. the EMI conversion typically happens around the statement generation date.

step 3: cancel within the 15-day window. to avoid charges, the cancellation request should be made within 15 days of the EMI conversion.

what happens after cancellation

cancelling an EMI within 15 days reverses the entire transaction. the full purchase amount appears as a regular charge on the credit card statement. the processing fee, usually 2.99% of the transaction, gets refunded. no interest accrues on the amount.

if the EMI was linked to an instant discount or no-cost EMI offer, the situation changes. these offers are tied to the EMI conversion. cancelling the EMI may lead to the discount being reversed or adjusted. this is particularly important for no-cost EMI offers where the discount effectively covers the interest cost.

common reasons for cancellation

borrowers often cancel   credit card EMIs for several reasons. some use the no-cost EMI discount and then cancel the EMI to effectively get the discount on a regular purchase. others realise the interest cost is higher than expected and decide to pay the full amount upfront.

in either case, understanding the timing and charges is essential before making the request.

frequently asked questions

1. can a credit card EMI be cancelled without any charges?

cancellation is possible only within 15 days of the EMI conversion. during this period, no foreclosure charges apply and the processing fee is reversed.

2. what happens if an EMI is cancelled after 15 days?

a foreclosure charge of 3% of the outstanding principal applies. additional interest for the next month may also be charged.

3. can an EMI that had an instant discount be cancelled?

it depends. states that EMIs with instant discounts may not be eligible for cancellation within 17 days of booking. the discount may be reversed if the EMI is cancelled.

4. how to cancel an  credit card EMI?

call   customer care and request cancellation of the specific EMI. the cancellation is usually processed immediately.

5. what happens to the processing fee if the EMI is cancelled?

if cancelled within 15 days, the processing fee gets fully reversed. if cancelled after 15 days, the fee is not refunded and foreclosure charges also apply.