Know the Benefits of Making Timely EMI Payments

An EMI payment is a simple and budget-friendly option to complete your loan repayment within the stipulated timeline. Most lenders offer numerous options, allowing you to manage the EMI amount and keep the borrowing cost within your budget. This way, you do not have to stress about making a lump sum payment. 

However, paying these instalments on time is crucial for many reasons. If you’re wondering ‘what happens if we don’t pay EMI on time’, here’s a list of a few consequences you may have to face:

• Late payment fees
• A drop in your credit score
• Risk of collateral loss
• Added financial liabilities
• Lower chances of getting a good loan offer in future

Read on to know the benefits of timely EMI payments and smart tips that help you make these payments on time.

Benefits of Paying EMI on Time

Here are some of the benefits you can enjoy with timely EMI payments. 

Benefits	Explanation
Improved Credit Score	Paying your EMIs on time helps build your credit history which helps boost your credit score.
Avoid Late Payment Penalties	Lenders levy late payment penalties if you miss the due date, which can increase your borrowing costs. But if you pay on time, these charges won’t be levied.
Reduced Interest Rates	Maintaining good creditworthiness allows you to leverage it and secure lower interest rates, which can help you save more each month.
Better Financial Offers	A boost to your credit score can help you qualify for loans and credit cards with lower interest rates and more favourable terms.
Reduced Financial Stress	Making EMI payments on-time helps you avoid the risk of late payment charges and other penalties, which can add to your financial liability.
Building Good Customer Relations	Helps build a long-lasting relationship with the lender, helping you avail better loan offers.

Also Read: Want a lower EMI For a Personal Loan?

Easy Tips to Pay Your EMI on Time

Now that you know why paying your instalments is important, here are some tips to make EMI payments on time. 

• Choose the Right Terms: Choose a suitable tenure and EMI amount for stress-free repayment.
• Opt for Autopay Facility: The auto-debit option helps you enjoy seamless loan payments, as you don’t need to track due dates.
• Set Reminders: You can ask the lender to send you an alert before the due date or set up a reminder on your calendar.
• Optimise Your Budget: Avoid unnecessary expenses and prioritize your repayment by creating a well-planned budget.
• Increase Your Income: Use alternative sources of income or ask your employer for an increment to manage your loan repayment easily.
• Consolidate Your Existing Loans: You can opt for debt consolidation to merge your loans and streamline payments.
• Extend Your Tenure: Choosing a longer tenure reduces your EMIs, allowing you to pay your monthly instalments without overburdening your budget. However, this option also increases your interest liability, so make a well-informed decision.
• Build an Emergency Fund: This option helps you continue your repayments in case of an unexpected job loss or medical emergency. 

Using these tips, you can comfortably repay without delay and avoid the risk of late payment or default. Another crucial tip is choosing the right lender that offers the required financial assistance at affordable rates. This is where you can rely on Fibe.

With our Instant Personal Loan, you can easily get up to ₹5 lakhs for all your urgent or planned requirements. You also enjoy a simplified digital lending experience with easy-to-meet eligibility criteria, an affordable interest rate and a flexible tenure option of up to 36 months.  

Moreover, you can easily foreclose your loan without any additional charge and save on interest whenever you have the funds available. Download our Personal Loan App from the Google Play or App Store without charges or simply visit our website to apply. 

FAQs on Timely EMI Payments

Is it better to pay EMIs early?

Yes! Paying EMIs early can reduce the monthly repayment burden and have a positive impact on your credit score. 

What happens if I pay all EMI at once?

Paying all your EMI amounts at once helps you reduce your interest burden and boost your credit score. This means you are foreclosing your loan before the tenure ends and becoming debt-free. 

Which is better: EMI or full payment?

Both options have unique benefits, which you can choose from based on your financial standing. EMI is a better option to manage your repayment with affordable instalments. Alternatively, opting for a loan pre-closure helps you save on interest. 

Can I pay 2 months’ EMI in advance?

If you’re wondering, ‘Can I pay EMI in advance?’, you must first assess your finances. You can opt for an advance EMI payment if you have surplus funds available.