Should we opt for festive offers deployed by e-commerce sites, card issuers?


After losing two precious years to the Covid pandemic, e-commerce sites, lenders and card issuers have pulled out all the blazing guns for the 2022 holiday season. Consumers also seem excited about shop. Starting with Navratri, it is now Dhanteras, Diwali, Bhai Dooj, Christmas and finally New Year. Obviously, Indians have many reasons to celebrate. Coinciding with different holidays and periods, various shopping deals have been rolled out to appeal to shoppers. Here is an overview of the different types of offers offered and their advantages and disadvantages.

Refund offers

Have you come across promotional emails or phone notifications about “up to 10% cashback” or “10% instant cashback*” from e-commerce sites or card companies? You’re not alone. These cashback offers are usually conditional and up to a certain absolute value. For the uninitiated, cashback means money paid into the customer’s card account under a program. For example, there is 10% cashback on HDFC bank cards on minimum spend of ₹7,500 at LifeStyle stores or transactions on the website. Maximum CashBack is ₹1,000 on HDFC Bank Credit Card and ₹750 on HDFC Bank Debit Card. In case of reconciliation of SBI card with some companies, the minimum transaction value to get a refund can sometimes reach ₹30,000.

Festive cashback offers also come through co-branded credit cards. For example, Flipkart Axis Bank credit card refund proposal. But the cashback amount may differ by merchant type (Flipkart and Flipkart Entities 5%, Preferred Merchants 4%, and All Other Merchants 1.5%). Note that cash back does not apply to fuel expenses, purchase of gift cards, EMI transactions, purchases converted to post facto EMI, etc.

For any cashback offer accessed through a credit card, you should remember that any remaining cashback may immediately cease to be valid upon cancellation of the credit card or default on your part.

Discount on EMI

For some festive offers, including product categories like mobiles, groceries, etc., card companies, through pacts with some e-commerce companies, offer card discounts on EMI transactions. To attract customers, the rebate amount is higher on EMI transactions than on non-EMI transactions. For example, in the case of mobiles, the maximum discount on EMI transactions can be ₹1,750 vs. ₹1,250 on non-EMI transactions. Although there is no limit to the number of transactions under these programs, you can generally earn the maximum cashback per card during the offer period. The maximum discount per card is calculated as cumulative savings across all eligible platforms.

Customers should note that EMI transactions may incur additional fees such as a “convenience fee” plus GST for successful transactions at certain merchants. Additionally, interest charges can be borne by either the merchant or the customer. These terms and conditions are explicitly mentioned. So it would be better if they compare the extra cash back demanded by the card company with the extra money they will shell out. All cards issued by a card issuer are not eligible for a discount on the EMI program. Likewise, the marketing program is usually to push the sales of particular products. For example, Apple iPhone 14, iPhone 14 Pro, iPhone 14 Max and their variants are excluded from certain campaigns.

Loan Fee Waiver

PNB, ICICI Bank, Union of Bank and Central Bank, etc. have aligned the waiver of processing or transaction fees. Union Bank has announced a waiver of processing fees under Union Home (including trade-in) and the Union Miles program until 31.01.2023.

For those using digital channels to apply for home loans and auto loans, some banks are getting a concession. Additionally, some lenders will not charge legal and appraisal fees when taking over home loans from other banks and financial institutions.

Some private sector banks offer discounts on luxury goods as well as on e-commerce platforms. Note that these offers are limited to a certain period and vary by category. The programs are applicable when using the debit/credit card of the bank in question, opt for the EMI without fees to finance the purchases.

Typically, the processing fees for a loan are extremely low. However, as a marketing ploy, these discounts are very popular among borrowers due to the obsession with discounts. Don’t make borrowing decisions based on fee waivers or small adjustments in cost reduction.


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