what is down payment in emi

A down payment in EMI is an initial payment made for the purchase of an item on credit. It represents a percentage of the total purchase price, and the remaining amount is usually financed and repaid over time through Equated Monthly Installments (EMIs). Making a down payment is advisable as it reduces the loan amount, interest payments, and monthly payment amounts. Lenders may specify a minimum amount for the down payment, and the percentage required can vary. A larger down payment reduces the risk for lenders and can lead to lower interest rates. Some schemes, such as zero down payment financing, allow purchases to be made on EMIs without requiring a lump-sum payment upfront