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Offers are for select cardholders and depend on the credit history WHILE some banks offer EMI rates similar to the personal loan rates, generally it is slightly higher than the latter

EVEN the most prudent credit card holder at some point of time would have splurged on certain occasions and ended up with a large outstanding bill to be paid before the stipulated time. An outstanding credit card balance is worrisome because of the high interest rates. There are several options to defer an overdue payment and the card-issuer banks themselves offer some of them.

Before going for the options offered by banks, one should try some of the 'benign ways' to pay off the credit card balance.

One can take a personal loan to pay off the bill. A personal loan with 15 to 18 per cent interest per annum is definitely cheaper than the roll-over credit card interest rate that is anywhere between 2 per cent and 4.5 per cent per month (24-54 per cent annually).

Banks too want the money to be paid back and they are offering equated monthly schemes or easy installment schemes. Some offer EMI on outstanding payment and some only for transactions. The EMI interest rates are rather flexible and are lower than rollover credit rates, which can go up to 4.5 per cent per month (54 per cent annually). While some banks offer EMI interest rates almost similar to the personal loan rates, generally it is slightly higher than the latter,

State Bank of India's balance transfer on easy monthly installments offers 0.84 per cent per month interest for three months with a one-time processing fee of 2 per cent. For six months, an interest of 1.57 per cent is charged with 2 per cent processing fee. SBI' Flexipay option allows transactions above Rs 2,500 to be converted into installments for tenures of six, 12 and 24 months. This option is offered at an interest rate of around 14.5 per cent per annum and onetime processing fee of 2 per cent. For a transaction of Rs 1,000, a customer will have to pay a monthly installment of Rs 178.8 for six months and will end up paying a total of Rs 1,072.8. For 12 months, the installment will be Rs 95.4 and total payment of Rs 1,144.8 and for 24 months, the installment amount will come to Rs 53.8 and the total payment will come to Rs 1,291.2.

Most banks offer EMI schemes for credit card balance payments or transactions. ICICI Bank has `EMI-on-call' and `instant EMI', HDFC bank offers easy EMI and Citibank has `click an EMI'. There are also options where one can pay either fixed EMIs or varying installments for fixed tenures.

Most banks have easy procedures for conversion of outstanding into EMIs.

In many cases, a phone call to the customer care department is enough and some of the select merchant outlets have tie ups with banks for conversion of transactions into EMIs.

However, some of these offers are available for only selected credit card holders. It also depends on the credit history of the card holder.

Happy Investing!!

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You can write back to us at PrajnaCapital [at] Gmail [dot] Com

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Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

Invest Tax Saving Mutual Funds Online

Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

Download Tax Saving Mutual Fund Application Forms from all AMCs

Download Tax Saving Mutual Fund Applications

These Application Forms can be used for buying regular mutual funds also

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

1. ICICI Prudential Tax PlanInvest Online
2. HDFC TaxSaverInvest Online
3. DSP BlackRock Tax Saver FundInvest Online
4. Reliance Tax Saver (ELSS) FundInvest Online
5. Birla Sun Life Tax Relief '96 Invest Online
6. IDFC Tax Advantage (ELSS) FundInvest Online
7. SBI Magnum Tax Gain Scheme 1993Invest Online
8. Sundaram Tax SaverInvest Online
9. Edelweiss ELSS Invest Online

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Best Performing Mutual Funds

1. Largecap Funds Invest Online
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4. Sector Funds Invest Online

1. Reliance Banking Fund
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5. Tax Saver MutualFundsInvest Online
1. ICICI Prudential Tax Plan
2. HDFC Taxsaver
3. DSP BlackRock Tax Saver Fund
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6. Gold Mutual Funds Invest Online

1. Relaince Gold Savings Fund
2. ICICI Prudential Regular Gold Savings Fund
3. HDFC Gold Fund