The State Bank of India (SBI) has announced that it will charge processing fees as well as taxes to its credit card customers on all monthly installment payment equivalent (EMI) purchase transactions. SBI informed its credit card customers on Friday, November 12 via an email.
According to reports, SBI Cards & Payment Services Private Limited (SBICPSL) said the bank will now charge a processing fee of Rs 99 and levy taxes on all EMI purchase transactions. This will come into force on December 1, 2021.
The lender will now charge the processing fee for all EMI transactions made at point-of-sale and e-commerce sites such as Amazon, Flipkart, and Myntra. These fees are in addition to the interest charges for converting the purchase to an IME.
This will likely affect cardholders who like to make large purchases using the EMI payment options offered by merchant websites such as âBuy Now, Pay Laterâ (BNPL) etc. This will make purchasing through the EMi options more expensive.
âDear Cardholder, We would like to inform you that as of December 1, 2021, a processing fee of Rs. 99+ applicable taxes will be levied on all merchant EMI transactions made in the point of sale / on merchant’s website / app. We thank you for your continued patronage. Please click here to learn more about the merchant’s EMI processing fee, âthe email sent to customers read.
Processing fees apply to transactions successfully converted to EMI. All EMI transactions made before December 1 and booking made after December 1 will be exempt from this processing fee.
The bank will inform customers of the applicability of processing fees on EMI transactions to cardholders through billing slips when making purchases at point of sale. For customers doing EMI transactions online, the bank will indicate the processing fee on the checkout page.
If the EMI transaction is canceled, the processing fee will also be waived. However, it will not be the same in the event of pre-closure. Reward Points will not apply to transactions converted to Merchant EMI.
How does this work?
For example, if you buy consumer electronics using an SBI credit card from one of the e-commerce websites under their EMI program, SBICPSL will charge you Rs 99 as a processing fee. as well as applicable taxes. This will be reflected on your monthly credit card statement along with the EMI amount.
This will make âBuy Now, Pay Laterâ programs more expensive.