PROFX offering Finance for AV at 0% int

[HiFiManish]

I was running around known authorized shops in BLR for getting AVR / Speakers on EMI.

Onkyo dealers (modern world and Wonderland) & Thomsun do have tie up with Bajaj on 4/12 basis only. Apart form that 700/- plus, is the processing charge.
Thomsun has additional condition of >30K spend.
Apart from above Reliance mart @ Meenakshi Mall also have tie up with Bajaj, but they do have limited range of Yamaha.
I was following up with ProFx since last Diwali for any financial tie up, and it was being discussed at HO level b/w Bajaj & ProFx. Looks like now they have got it done.
HTStore has tie up with HDFC for financing @ 11% PA.
Bajaj EMI card is only for obviating the need of repeated documentation. The T&C of getting stuff on EMI card remains same on shops as of getting a fresh loan.
E Zone @ Koramangala provides EMI conversion on Stan. Chart. (?) cards only, so do many other shops on different cards for a tenure of 3 / 6 / 9 months - with a charge of Processing Fee.
Technoguru also shows EMI conversion facility on their web site, but no details are available!

 

[manniraj]

What's wrong with credit being reported to CIBIL? If your payments are timely and there is no overdue then the credit report is favorable. To many borrowings at the same time may be detrimental.

Yes absolutely, way back in 2003-04 when I used to work for a PSU bank we started reporting every credit transaction in monthly report to the CIBIL. In fact taking loans will not effect your loan history but not paying in due time will definitely effect your credit history. As of now I think CIBIL is having close to 15 yrs of credit data of every loan individual either thru PAN or some other identity. So its very difficult to escape from CIBIL and you cannot avoid. I believe if you are on good credit history score you can even negotiate with the lender for a better interest rate on future loans.

 

[shaiju_o_thomas]

Thanks for sharing. I have a few standing instructions on CC. Makes me think now. Ill check my scores too.

 

[shuv]

Funny thing though. Apparently the EMI scheme is valid on MRP or their usual 10% off price. For 25% off (xx12) you need to pay in full.

 

[MZB]

Finance Companies work on IRR and Income is from Interest . So a 0% is most of the time not 0% to the companies . Either the manufacturer / dealer pays in the form of subventions or the customer pays . Depends on the product / competition .

In a scheme like this where there is not much competition in the finance scheme the upfront Interest in the form of subvention is deducted upfront and hence Dealers give less or no disc on finance scheme in comparison to cash schemes as finance co. pays him Inv Amnt - upfront interest charges - Documentation / service charges if any .

Finance company is return also pass on the commissions on net disbursement amount to the dealer which is very low and that is the max disc a dealer at times offer to the customer .

Here in this case Bajaj is the only co. offering the scheme , so the IRR would be higher than normal Consumer Durable Good Player where there are competition from Future Capital / Tata Caps and some banks vis Credit Cards and commissions lower .

 

[thebanik]

Finance Companies work on IRR and Income is from Interest . So a 0% is most of the time not 0% to the companies . Either the manufacturer / dealer pays in the form of subventions or the customer pays . Depends on the product / competition .

In a scheme like this where there is not much competition in the finance scheme the upfront Interest in the form of subvention is deducted upfront and hence Dealers give less or no disc on finance scheme in comparison to cash schemes as finance co. pays him Inv Amnt - upfront interest charges - Documentation / service charges if any .

Finance company is return also pass on the commissions on net disbursement amount to the dealer which is very low and that is the max disc a dealer at times offer to the customer .

Here in this case Bajaj is the only co. offering the scheme , so the IRR would be higher than normal Consumer Durable Good Player where there are competition from Future Capital / Tata Caps and some banks vis Credit Cards and commissions lower .

I guess there is a lot of pessimism regarding these EMI's. Dont know about ProFX but I bought Panasonic 50inch plasma around 2 years ago for the best price all over India from Croma store and also got it on Bajaj EMI.

 

[MZB]

I guess there is a lot of pessimism regarding these EMI's. Dont know about ProFX but I bought Panasonic 50inch plasma around 2 years ago for the best price all over India from Croma store and also got it on Bajaj EMI.

Depends on the product / Brand / Manufacturer and competition with in the brands and also with in the finance options . With fierce competition in off the shelf Consumer Durables Products , you can get the best of the deals and finance options as well !! But in Hi Fi products , not many finance company's have come out with EMI schemes and so you cant expect the best of the discounts along with 0% in all such products .

 

[AmitKumar]

i spoke to profx yesterday regarding interest free emi option for kef q300.

they mentioned this offer is only applicable for few packages. not valid for individual products.

 

[MZB]

i spoke to profx yesterday regarding interest free emi option for kef q300.

they mentioned this offer is only applicable for few packages. not valid for individual products.

That mean that the 0% is applicable on the select packages which has decent margins for the dealer which can be used as subventions as upfront interest deducted from the invoice amount !!!

 

[Thad E Ginathom]

I never heard the word "subvention" before. it has a specific meaning in Indian finance industry?

 

[MZB]

I never heard the word "subvention" before. it has a specific meaning in Indian finance industry?

Nope . It is the word most commonly used in retail finance while calculating the IRR ( Not the flat ROI ). As nothing comes for free so why would a finance company give a 0% scheme without any income ? A 0% scheme means that the interest rate to maitain the desired IRR has to be charged upfront . For 0% scheme most of the finance company's work on an IRR of 14% ( Roughly 7% flat pa ), [actual flat ROI is much higher as most of the 0% scheme works on vanilla product , ie , 12 months - 4 in advance] and this they deduct from the disbursement amount, ie, Inv amount - subvention - documentation / service charges if any .

The amount deducted upfront from the disbursement amount to maintain IRR in 0% scheme is called Subvention and it goes out of the pocket of a dealer / manufacturer or both and this depends on product to product basis .

Hence on a 0% schemes the offers on cash are always better than on EMI's .
So if a dealer is offering a cash discount of 14000 INR for a product worth 1 L on deals on cash , He would only offer a discount of 7000 for a 0% scheme as he is anyways paying his balance 7000 to the finance company .

In a more competitive world of fast moving Consumer Durable the manufacturer like samsung/ LG etc keeps a separate amount for subvention for any 0% scheme and it is not the dealer alone who pays for it . This kitty of manufacturer sharing the subvention with the dealer is only for finance options and not available for cash deals .

 

[Thad E Ginathom]

Thank you for the nuts-and-bolts explanation, MZB.

 

[alphacentury100]

i spoke to profx yesterday regarding interest free emi option for kef q300.

they mentioned this offer is only applicable for few packages. not valid for individual products.

But that is not what they replied when I asked them through mail. I asked "Do you sell KEF R series speakers through babaj finance at 0%" and they answered "we sell all speakers through 0% int bajaj fin"

 

[AmitKumar]

But that is not what they replied when I asked them through mail. I asked "Do you sell KEF R series speakers through babaj finance at 0%" and they answered "we sell all speakers through 0% int bajaj fin"

Then one of the representative giving information is unaware about the scheme.
I may go there tomorrow or later, will confirm again.

 

[alphacentury100]

Then one of the representative giving information is unaware about the scheme.
I may go there tomorrow or later, will confirm again.

That will help a lot of us

 

[MZB]

Check with your Credit Card Companies . There is an option of converting into EMI's . Some companies do not charge any insterest on it but a nominal Processing Fee .

This way you can bargain for a better cash deals which might not be possible with 0% finance schemes !

 

[AmitKumar]

I went to Profx yesterday for an audition.

The representative clarified that the 0 percent interest scheme through Bajaj Finance is only applicable on few select packages.

 

[MZB]

I went to Profx yesterday for an audition.

The representative clarified that the 0 percent interest scheme through Bajaj Finance is only applicable on few select packages.

And what about the discounts on Cash or Finance Deals on the Packages covered under Finance options ?

 

[cyber_cat]

I went to Profx yesterday for an audition.

The representative clarified that the 0 percent interest scheme through Bajaj Finance is only applicable on few select packages.

hi, did u find out what packages these were ?

I am guessing may be HT packages being offered by other places like MODERN WORLD, ETC. where Bajaj has tie ups ?

 

[AmitKumar]

And what about the discounts on Cash or Finance Deals on the Packages covered under Finance options ?

offer was on mainly home theatre packages, i was trying to audition bookshelf speakers, could not give much attention to those packages. I think there are about nine packages they have designed. May be somebody can call and check. If i go again this week end then i will check on this for sure.