Customers and showroom dealers have welcomed the Reserve Bank of India’s (RBI) decision to ban zero per cent interest rate schemes for purchase of consumer goods even as the goods companies are apprehensive about the decision’s impact on the forthcoming festive season sales.
It has been reported that the RBI also directed that no additional charges can be levied on payment though debit cards.
Consumers feel they will be benefited through this move immensely.
Debit cards
“Most banks promote usage of debit cards for making purchases of consumer goods but few outlets collect service charges for entertaining transactions.
“Now, this will be stopped and consumers will gain,” points out Satish Chandra, a corporate employee and a consumer.
Interest component
Generally, in the zero per cent monthly schemes offered on credit cards, the interest component is mostly hidden and passed on to the customers as processing fee or service charge etc.
“It is a good decision. Under these schemes, consumers do end up paying more than the actual price. They are exploited and are made to pay the first month instalment prior to making the transaction although it is a zero interest scheme,” explains a manager of an electronics showroom here.
On the possibility of this decision casting an impact on the forthcoming festive season sales, companies are apprehensive.
NBFC loans
“I personally feel there will not be much impact as the consumers will still have the option of taking a loan from non-banking finance companies.
“It will also make consumers physically come to the stores and make purchases. Dealers can pass on the profit margins to consumers directly,” observes Nitish Shah, Executive Director of Shah Electronics.
